Trade-Ideas LLC identified

Vale

(

VALE

) as a post-market leader 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 $123.1 million.
  • VALE is up 4% today from today'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 4.2%. VALE has a PE ratio of 4. Currently there are 2 analysts that rate Vale a buy, 6 analysts rate it a sell, and 7 rate it a hold.

The average volume for Vale has been 28.6 million shares per day over the past 30 days. Vale has a market cap of $22.1 billion and is part of the basic materials sector and metals & mining industry. Shares are down 45.7% 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 disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from the ratings report include:

  • 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, VALE SA's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to $996.00 million or 78.32% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • VALE's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 64.56%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • VALE SA has improved earnings per share by 17.9% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, VALE SA increased its bottom line by earning $0.13 versus $0.01 in the prior year. For the next year, the market is expecting a contraction of 337.7% in earnings (-$0.31 versus $0.13).
  • VALE, with its decline in revenue, underperformed when compared the industry average of 18.9%. Since the same quarter one year prior, revenues fell by 29.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

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