Petroleo Brasileiro SA Petrobras (PBR.A): 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.

Petroleo Brasileiro SA Petrobras ( PBR.A) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole was unchanged today. By the end of trading, Petroleo Brasileiro SA Petrobras fell 58 cents (-3.2%) to $17.55 on heavy volume. Throughout the day, 11.2 million shares of Petroleo Brasileiro SA Petrobras exchanged hands as compared to its average daily volume of 7.1 million shares. The stock ranged in price between $17.45-$17.95 after having opened the day at $17.90 as compared to the previous trading day's close of $18.13. Other companies within the Basic Materials sector that declined today were: Richmont Mines ( RIC), down 25.1%, Pacific Booker Minerals ( PBM), down 19.6%, Geokinetics ( GOK), down 15.8%, and USEC ( USU), down 14%.
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Petroleo Brasileiro S.A. operates as an integrated oil and gas company in Brazil and internationally. Petroleo Brasileiro SA Petrobras has a market cap of $117.4 billion and is part of the energy industry. The company has a P/E ratio of 7.1, below the S&P 500 P/E ratio of 17.7. Shares are down 22.7% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Petroleo Brasileiro SA Petrobras as a hold. The company's strengths can be seen in multiple areas, such as its attractive valuation levels and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself.

On the positive front, Samson Oil & Gas ( SSN), up 20.1%, Ossen Innovation ( OSN), up 19.5%, Prospect Global Resources ( PGRX), up 12%, and Forbes Energy Services ( FES), up 10.7%, were all gainers within the basic materials sector with Nexen ( NXY) 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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