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.
Chesapeake Energy (
CHK) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day up 0.3%. By the end of trading, Chesapeake Energy fell 59 cents (-3.3%) to $17.24 on average volume. Throughout the day, 12.5 million shares of Chesapeake Energy exchanged hands as compared to its average daily volume of 13.4 million shares. The stock ranged in price between $17.08-$17.52 after having opened the day at $17.49 as compared to the previous trading day's close of $17.83. Other companies within the Basic Materials sector that declined today were:
McMoRan Exploration (
MMR), down 22.5%,
GeoGlobal Resources (
GGR), down 18.2%,
Cereplast (
CERP), down 14.9%, and
Oxford Resource Partners (
OXF), down 10.7%.
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Chesapeake Energy Corporation engages in the acquisition, exploration, development, and production of natural gas and oil properties in the United States. The company also offers marketing, midstream, drilling, and other oilfield services. Chesapeake Energy has a market cap of $11.69 billion and is part of the energy industry. The company has a P/E ratio of -14.3, below the S&P 500 P/E ratio of 17.7. Shares are down 20% year to date as of the close of trading on Friday. Currently there are nine analysts that rate Chesapeake Energy a buy, one analyst rates it a sell, and 18 rate it a hold.
TheStreet Ratings rates Chesapeake Energy as a
hold. The company's strongest point has been its a solid financial position based on a variety of debt and liquidity measures that we have looked at. At the same time, however, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.
On the positive front,
Emerald Oil (
EOX), up 312.1%,
Geokinetics (
GOK), up 35.5%,
Samson Oil & Gas (
SSN), up 18.2%, and
China Shen Zhou Mining & Resources (
SHZ), up 17.2%, were all gainers within the basic materials sector with
Gold Fields (
GFI) 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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