Apache Corporation (APA): Today's Featured Basic Materials Laggard

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.

Apache Corporation ( APA) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day down 0.2%. By the end of trading, Apache Corporation fell $1.30 (-1.7%) to $75.80 on average volume. Throughout the day, 3.4 million shares of Apache Corporation exchanged hands as compared to its average daily volume of 2.8 million shares. The stock ranged in price between $75.57-$77.28 after having opened the day at $77 as compared to the previous trading day's close of $77.10. Other companies within the Basic Materials sector that declined today were: Recovery Energy ( RECV), down 23.2%, Banro Corporation ( BAA), down 12.5%, Cliffs Natural Resources ( CLF), down 12.1%, and Torch Energy Royalty ( TRU), down 9.8%.
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Apache Corporation, an independent energy company, explores for, develops, and produces natural gas, crude oil, and natural gas liquids. Apache Corporation has a market cap of $29.46 billion and is part of the energy industry. The company has a P/E ratio of 12, below the S&P 500 P/E ratio of 17.7. Shares are down 14.9% year to date as of the close of trading on Monday. Currently there are 19 analysts that rate Apache Corporation a buy, no analysts rate it a sell, and four rate it a hold.

TheStreet Ratings rates Apache Corporation as a hold. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.

On the positive front, Recon Technology ( RCON), up 13%, Oxford Resource Partners ( OXF), up 11.8%, Geokinetics ( GOK), up 11.1%, and GeoPetro Resources Company ( GPR), up 10.7%, were all gainers within the basic materials sector with Mosaic ( MOS) 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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