RTI International Is the Top Investment Choice Among Basic Mining and Metal Stocks

Titanium will rule in 2007, states Cleveland Research analyst Chris Olin, in a article appearing on Forbes.com in December of last year. According to Mr. Olin, the industry's growth will be driven, in large part, due to increased spending in the aerospace market. New airplanes, such as the Boeing 787 and the Airbus A-380, are increasingly being constructed with titanium as a primary metal. The Boeing 787, for instance, is constructed of 15 percent titanium according to the manufacturer. To understand the full significance that the increasing role of titanium in new jet designs will have on titanium demand, it is vital for investors to have a precise realization of the changes the entire airline industry is undergoing and what the projected demand for new aircraft is over the next several years. By one estimate, given by Airbus, the overall demand for new aircraft between now and 2025 could equate to over $2.6 trillion in aerospace spending. The company projects that over 22,700 new passenger and freight aircraft will need to be produced to meet the demand over the same time period. Aerospace is not the only catalysts for sales of titanium as many new weapon systems, such as advanced fighter aircraft, spy satellites, and missiles, are increasingly being constructed out of the lightweight metal. Titanium is also being utilized heavily in the energy industry due to its resistance to corrosion and extreme strength in stressful environments and could play a vital role in the future of biofuels. These developments will ultimately be a tide that lifts all boats, however, investors, looking for the safest and highest returns, should focus on the company with the best management and long term potential. The company that meets this description is RTI International for several reasons (For purposes of disclosure, I own shares in this company).

The company, which is one of Olin's favorites in the industry, is based in Ohio and is a member of the S&P 600 and S&P 1500. With a 7 percent share of the rapidly growing titanium market, RTI International has room to grow and capture additional market share. Furthermore, the company has a long history of beating earnings targets, which can be attested to by the company's recent blow out fourth quarter and full year results for the year 2006. Another positive for shareholders for RTI is the lack of analysts who cover the company's stock, which is indicative of many small companies. As Wall Street begins to discover this hidden treasure trove and analyst coverage grows, the stock is bound to appreciate for increased coverage, if positive, will generate buying momentum among institutional and retail investors. As for financial strength, the company boasts a healthy 5.8 current ratio and zero debt. Moreover, the company reported having $3.34 a share in cash, as of the most recent quarter, a sizable amount that can be used for increased capital spending or returned to shareholders through dividends or buybacks. In summation, RTI International is poised to continue to reward shareholders for many years to come.