Encana Corp (ECA): Today's Featured Basic Materials Winner

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Encana ( ECA) pushed the Basic Materials sector higher today making it today's featured basic materials winner. The sector as a whole closed the day up 0.9%. By the end of trading, Encana rose 48 cents (2.3%) to $20.98 on average volume. Throughout the day, 5.8 million shares of Encana exchanged hands as compared to its average daily volume of 4.9 million shares. The stock ranged in a price between $20.27-$21 after having opened the day at $20.42 as compared to the previous trading day's close of $20.50. Other companies within the Basic Materials sector that increased today were: HyperDynamics Corporation ( HDY), up 22%, General Steel Holdings ( GSI), up 22%, BMB Munai ( BMBM), up 14%, and MV Oil ( MVO), up 13.3%.
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Encana Corporation and its subsidiaries engage in the exploration for, development, production, and marketing of natural gas, oil, and natural gas liquids. Encana has a market cap of $15.21 billion and is part of the energy industry. The company has a P/E ratio of -5, below the S&P 500 P/E ratio of 17.7. Shares are up 10.6% year to date as of the close of trading on Thursday. Currently there are two analysts that rate Encana a buy, three analysts rate it a sell, and 12 rate it a hold.

TheStreet Ratings rates Encana as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, weak operating cash flow and generally high debt management risk.

On the negative front, Recon Technology ( RCON), down 29.4%, Pure Bioscience ( PURE), down 13.7%, ZaZa Energy ( ZAZA), down 11.2%, and Apco Oil and Gas International ( APAGF), down 10.3%, were all laggards within the basic materials sector with Vale ( VALE) being today's basic materials sector laggard.

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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