Louis Navellier Weighs In On the Mechel Implosion

Growth stock investing can be beautiful in its simplicity.

Value investors and short sellers think they are superior to the fast money crowd, but the recent implosion in the value camp, and short squeeze in financials hopefully taught them a lesson in spotting crowded trades.

There are 100 "value" blogs for every "growth" blog, if you can even find one.

Louis Navellier writes the only one I am aware of, and he constantly proves that growth stock investing might not require a brain, but does require a huge set of balls.

I don't know what Vladimir Putin is up to exactly, but the shares of Mechel (MTL-NYSE) has certainly been on a wild ride. Louis is a big fan, and is trying to sort through the damage and calm skittish investors:

Yesterday, shares of Mechel plunged 38%. The reason for the drop is former President Vladimir Putin, who's now Prime Minister, criticized Mechel's pricing policies. Putin claims that Mechel is selling its steel to foreign customers at twice the rate of Russian customers, and he's asked the government's anti-trust agency to look into the matter. Louis Navellier's Market Blog

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Putin and the Reservoir Dogs

photo by Alexei Druzhinin
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Doing business in Russia is very tricky and the last thing you want to do is make enemies in the Kremlin, particularly Putin. The Russian government went after the oil company Yukos for tax evasion. The billionaire behind Yukos is now in prison in Siberia, and other key officials fled the country. The fear is that the same could happen to Igor Zyuzin, the billionaire behind Mechel.

The good news is that the stock is bouncing back today by over 13%, and the company has released an official statement saying that it will cooperate with the government. I’ll keep new posted on any further development in Mechel. In the meantime, please try to not check the stock price every five minutes. You’ll only drive yourself crazy. As soon as I have a firm judgment on the fate of this company--grounded in fact and not rumors--I will let you know.

Louis might want to check in with steel analyst Michelle Appelbaum, who is running one of the most profitable independent research boutiques on Wall Street. I could tell you what she is saying, but I would have to kill you, Russian gangsta style.

But something tells me Putin was short, and if he gets long, the stock will ramp. It is quite easy. What a great business model he has.

The trend is your friend, at least until Putin puts his foot on your neck.

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Does Russia have an SEC? I dunno, call RedStar Asset Management...The chart reminds me of Stalingrad

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What’s Happening at Mechel?
Louis Navellier’s Market Blog

Russian Steel, Coal Shares Plunge After Putin Criticizes Mechel
Bloomberg

Official Statement of Mechel OAO
FBN
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The content contained represent the opinions of 1440 Wall Street. This commentary in no way constitutes a solicitation of business or investment advice. It is intended solely for the entertainment of the reader, and the author. No Position

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