Cliffs Natural Resources Inc. (CLF): 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.

Cliffs Natural Resources ( CLF) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day up 1.1%. By the end of trading, Cliffs Natural Resources fell 68 cents (-1.8%) to $37.49 on average volume. Throughout the day, nine million shares of Cliffs Natural Resources exchanged hands as compared to its average daily volume of 8.3 million shares. The stock ranged in price between $37.07-$38.58 after having opened the day at $38.21 as compared to the previous trading day's close of $38.17. Other companies within the Basic Materials sector that declined today were: GeoPetro Resources Company ( GPR), down 12.4%, BioFuel Energy Corporation ( BIOF), down 9.4%, Gold Reserve ( GRZ), down 6.1%, and China Gengsheng Minerals ( CHGS), down 6%.
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Cliffs Natural Resources Inc., a mining and natural resources company, engages in the production of iron ore pellets, fines and lump ore, and metallurgical coal. Cliffs Natural Resources has a market cap of $5.53 billion and is part of the metals & mining industry. The company has a P/E ratio of six, below the S&P 500 P/E ratio of 17.7. Shares are up 0.6% year to date as of the close of trading on Thursday. Currently there are two analysts that rate Cliffs Natural Resources a buy, no analysts rate it a sell, and 12 rate it a hold.

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

On the positive front, Andatee China Marine Fuel Services Corporat ( AMCF), up 20%, Gevo ( GEVO), up 19.8%, Double Eagle Petroleum Company ( DBLE), up 14.8%, and Timberline Resources Corporation ( TLR), up 12.4%, were all gainers within the basic materials sector with Valero Energy Corporation ( VLO) 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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