NEW YORK ( TheStreet) -- In March I noticed a dramatic shift in the distribution of buy rated stocks and sell rated stocks among the 16 sectors covered by ValuEngine. My analysis resulted in how I rated key sectors and what story each told about the U.S. economy. This last time I covered this concept was on April 5 when I wrote, Stock Ratings Key Market Top. Today I provide the current status of this unique analysis.
The basic materials sector is undervalued by 6.4% but only nine stocks out of 411 in the sector have buy ratings. There are 143 sell rated stocks and 57 strong sell rated stocks and thus 48.7% of all stocks in this sector are rated sell. This gives the sector an underweight rating.
The construction sector is 13.2% overvalued but only 17 stocks out of 160 in the sector have buy ratings. There are 40 sell rated stocks and 27 strong sell rated stocks and thus 41.9% of all stocks in this sector are rated sell. This gives the sector an underweight rating.There are five home builders in the sector that have been upgraded to buy recently and I will cover them on Thursday following this week's data on home builder sentiment and housing starts. A notable buy rated stock in this sector is cement company Cemex (CX - Get Report) which peaked at $12.57 on May 15. The stock closed Friday at $10.46 with its 200-week simple moving average at $9.90. The oils-energy sector is 8.2% overvalued and only 14 stocks out of 558 stocks in the sector have buy ratings. There are 141 sell rated stocks and 47 strong sell rated stocks and thus 33.7% of all stocks in this sector are rated sell. This gives the sector an underweight rating. (FSLR - Get Report) which peaked this year at $59.00 on May 21. The stock closed Friday at $44.71 with a semiannual value level at $36.34 and this month's pivot at $48.63, which was a value level as June began.
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