CF Industries Holdings Inc (CF): 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.

CF Industries Holdings ( CF) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day up 0.1%. By the end of trading, CF Industries Holdings fell $7.53 (-3.5%) to $209.69 on heavy volume. Throughout the day, 1.4 million shares of CF Industries Holdings exchanged hands as compared to its average daily volume of 916,000 shares. The stock ranged in price between $208.77-$216.86 after having opened the day at $215.92 as compared to the previous trading day's close of $217.22. Other companies within the Basic Materials sector that declined today were: Gasco Energy ( GSX), down 27.9%, American Vanguard Corporation ( AVD), down 10.4%, Quaterra Resources ( QMM), down 10%, and China Shen Zhou Mining & Resources ( SHZ), down 8.9%.
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CF Industries Holdings, Inc., through its subsidiary, CF Industries, Inc., manufactures and distributes nitrogen and phosphate fertilizer products, serving agricultural and industrial customers worldwide. It operates in two segments, Nitrogen and Phosphate. CF Industries Holdings has a market cap of $13.43 billion and is part of the chemicals industry. The company has a P/E ratio of 7.7, below the S&P 500 P/E ratio of 17.7. Shares are up 47.4% year to date as of the close of trading on Tuesday. Currently there are eight analysts that rate CF Industries Holdings a buy, no analysts rate it a sell, and six rate it a hold.

TheStreet Ratings rates CF Industries Holdings as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

On the positive front, Ossen Innovation ( OSN), up 20%, Recovery Energy ( RECV), up 9.9%, Lake Shore Gold ( LSG), up 9.5%, and Seabridge Gold ( SA), up 9.1%, were all gainers within the basic materials sector with EOG Resources ( EOG) 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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