Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified

Vale

(

VALE

) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Vale as such a stock due to the following factors:

• VALE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $200.5 million.

• VALE traded 398,258 shares today in the pre-market hours as of 8:58 AM.

• VALE is down 2.7% today from yesterday's close.

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More details on VALE:

Vale S.A., together with its subsidiaries, engages in the research, production, and sale of iron ore and pellets, nickel, fertilizer, copper, coal, manganese, ferroalloys, cobalt, platinum group metals, and precious metals in Brazil and internationally. The stock currently has a dividend yield of 5.8%. VALE has a PE ratio of 5.7. Currently there are 4 analysts that rate Vale a buy, 3 analysts rate it a sell, and 6 rate it a hold.

The average volume for Vale has been 29.2 million shares per day over the past 30 days. Vale has a market cap of $31.6 billion and is part of the basic materials sector and metals & mining industry. Shares are down 25.9% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Vale as a

sell

. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from the ratings report include:

• The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Metals & Mining industry. The net income has significantly decreased by 140.3% when compared to the same quarter one year ago, falling from $3,565.05 million to -$1,437.00 million.
• Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Metals & Mining industry and the overall market on the basis of return on equity, VALE SA underperformed against that of the industry average and is significantly less than that of the S&P 500.
• Net operating cash flow has decreased to $2,940.00 million or 36.54% when compared to the same quarter last year. Despite a decrease in cash flow VALE SA is still fairing well by exceeding its industry average cash flow growth rate of -57.49%.
• Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 52.51%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 140.00% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
• VALE SA has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, VALE SA reported lower earnings of $0.01 versus $0.94 in the prior year. This year, the market expects an improvement in earnings ($0.51 versus $0.01).

• You can view the full Vale Ratings Report.

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