Ecopetrol S.A. (EC): Today's Featured Basic Materials Laggard

Ecopetrol S.A ( EC) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day up 0.6%. By the end of trading, Ecopetrol S.A fell 35 cents (-0.6%) to $55.84 on average volume. Throughout the day, 650,866 shares of Ecopetrol S.A exchanged hands as compared to its average daily volume of 752,100 shares. The stock ranged in price between $55.78-$57 after having opened the day at $56.19 as compared to the previous trading day's close of $56.19. Other company's within the Basic Materials sector that declined today were: Whiting USA Trust I ( WHX), down 14.9%, Synthesis Energy Sys ( SYMX), down 10.3%, Renewable Energy Group ( REGI), down 9.2%, and BioFuel Energy Corporation ( BIOF), down 8.8%.

Ecopetrol S.A., an integrated oil company, engages in the exploration, development, and production of crude oil and natural gas. As of December 31, 2011, its proved reserves of crude oil and natural gas totaled 1,856.7 million barrels of oil equivalent. Ecopetrol S.A has a market cap of $114.7 billion and is part of the energy industry. The company has a P/E ratio of 9.3, below the average energy industry P/E ratio of 10.9 and below the S&P 500 P/E ratio of 17.7. Shares are up 25.7% year to date as of the close of trading on Wednesday. Currently there is one analyst that rates Ecopetrol S.A a buy, no analysts rate it a sell, and three rate it a hold.

TheStreet Ratings rates Ecopetrol S.A as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, good cash flow from operations and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

On the positive front, Georgia Gulf ( GGC), up 13.2%, Ikonics Corporation ( IKNX), up 11.2%, Thompson Creek Metals Company ( TC), up 10%, and Valhi Incorporated ( VHI), up 10%, were all gainers within the basic materials sector with Suncor Energy ( SU) being today's featured basic materials sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the basic materials sector could consider Materials Select Sector SPDR ( XLB) while those bearish on the basic materials sector could consider ProShares Short Basic Materials Fd ( SBM).
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