Inco Earns an Upgrade

Article Excerpt

We assign companies an SI Rating using a point system that’s based on nine key factors: profit and dividend history, balance sheet strength, industry prominence, geographical diversification, freedom from excessive regulation and business cycles, and the ability to profit from secular trends and habitual behavior. We constantly review these ratings, and make changes accordingly. In the late 1990s and the early part of this decade, INCO LTD. $54 (Toronto symbol N) struggled as the Asian economic crisis led to lower nickel demand and prices. In light of the bleak outlook, it seemed that Inco overpaid for the huge Voisey’s Bay nickel deposit in Labrador. The Newfoundland government’s demand that Inco build a smelter in the province to process the ore also threatened the project’s feasibility. The high cost of the Voisey’s Bay purchase also forced Inco to quit paying dividends. But spreading prosperity around the world has spurred nickel demand and prices. That helped make it economical for Inco to build a smelter in…

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