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.
Eldorado Gold (
EGO) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day up 0.4%. By the end of trading, Eldorado Gold fell 67 cents (-4.8%) to $13.35 on average volume. Throughout the day, 6.1 million shares of Eldorado Gold exchanged hands as compared to its average daily volume of 4.3 million shares. The stock ranged in price between $13.32-$14.03 after having opened the day at $13.99 as compared to the previous trading day's close of $14.02. Other companies within the Basic Materials sector that declined today were:
Freeport-McMoRan Copper & Gold (
FCX), down 16%,
BMB Munai (
BMBM), down 13.2%,
New Concept Energy (
GBR), down 11.8%, and
Recovery Energy (
RECV), down 10.8%.
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Eldorado Gold Corporation, together with its subsidiaries, engages in the exploration, development, mining, and production of gold properties in Brazil, China, Greece, and Turkey. Eldorado Gold has a market cap of $10.05 billion and is part of the metals & mining industry. The company has a P/E ratio of 32, above the S&P 500 P/E ratio of 17.7. Shares are up 2.7% year to date as of the close of trading on Tuesday. Currently there are 12 analysts that rate Eldorado Gold a buy, no analysts rate it a sell, and two rate it a hold.
TheStreet Ratings rates Eldorado Gold as a
buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.
On the positive front,
McMoRan Exploration (
MMR), up 87%,
Metabolix (
MBLX), up 30.7%,
Plains Exploration & Production Company (
PXP), up 23.4%, and
Cobalt International Energy (
CIE), up 18.6%, were all gainers within the basic materials sector with
Petroleo Brasileiro SA Petrobras (
PBR) 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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