Vale SA (VALE): Today's Featured Metals & Mining 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.

Vale ( VALE) pushed the Metals & Mining industry lower today making it today's featured Metals & Mining laggard. The industry as a whole closed the day up 0.3%. By the end of trading, Vale fell 39 cents (-1.9%) to $20.68 on average volume. Throughout the day, 15 million shares of Vale exchanged hands as compared to its average daily volume of 17.3 million shares. The stock ranged in price between $20.49-$20.97 after having opened the day at $20.93 as compared to the previous trading day's close of $21.07. Other companies within the Metals & Mining industry that declined today were: Gold Reserve ( GRZ), down 8.1%, Timberline Resources Corporation ( TLR), down 8.1%, Kingold Jewelry ( KGJI), down 5.9%, and Harmony Gold Mining ( HMY), down 5.5%.
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Vale S.A. engages in the exploration, production, and sale of basic metals in Brazil and internationally. The company is also involved in energy, logistics, and steel businesses. Vale has a market cap of $151.32 billion and is part of the basic materials sector. The company has a P/E ratio of 4.9, below the S&P 500 P/E ratio of 17.7. Shares are up 1.4% year to date as of the close of trading on Friday. Currently there are two analysts that rate Vale a buy, two analysts rate it a sell, and eight rate it a hold.

TheStreet Ratings rates Vale as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself and feeble growth in the company's earnings per share.

On the positive front, China Gengsheng Minerals ( CHGS), up 16.3%, China Natural Resources ( CHNR), up 13.1%, Northern Dynasty Minerals ( NAK), up 12.4%, and Molycorp ( MCP), up 12.2%, were all gainers within the metals & mining industry with Alpha Natural Resources ( ANR) being today's featured metals & mining industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the metals & mining industry could consider SPDR S&P Metals & Mining ETF ( XME) while those bearish on the metals & mining industry could consider PowerShares DB Base Metals Sht ETN ( BOS).

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