Agrium Inc (AGU): Today's Featured Chemicals 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.

Agrium ( AGU) pushed the Chemicals industry lower today making it today's featured Chemicals laggard. The industry as a whole closed the day up 0.2%. By the end of trading, Agrium fell $1.71 (-1.6%) to $102.68 on heavy volume. Throughout the day, 1.1 million shares of Agrium exchanged hands as compared to its average daily volume of 739,000 shares. The stock ranged in price between $101.52-$104.23 after having opened the day at $104.23 as compared to the previous trading day's close of $104.39. Other companies within the Chemicals industry that declined today were: Penford Corporation ( PENX), down 6.8%, Lightbridge ( LTBR), down 6.3%, Pure Bioscience ( PURE), down 6.3%, and BioFuel Energy Corporation ( BIOF), down 3.4%.
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Agrium Inc. engages in the retail of agricultural products and services worldwide. The company operates in three segments: Retail, Wholesale, and Advanced Technologies. Agrium has a market cap of $15.41 billion and is part of the basic materials sector. The company has a P/E ratio of 10.8, below the S&P 500 P/E ratio of 17.7. Shares are up 3.6% year to date as of the close of trading on Friday. Currently there are 13 analysts that rate Agrium a buy, two analysts rate it a sell, and six rate it a hold.

TheStreet Ratings rates Agrium as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, increase in net income, revenue growth and attractive valuation levels. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

On the positive front, Ferro ( FOE), up 30.8%, American Pacific Corporation ( APFC), up 9.6%, American Vanguard Corporation ( AVD), up 8.6%, and Ceres ( CERE), up 6.4%, were all gainers within the chemicals industry with Sherwin-Williams Company ( SHW) being today's featured chemicals industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the chemicals industry could consider Materials Select Sector SPDR ( XLB) while those bearish on the chemicals industry could consider ProShares Short Basic Materials Fd ( SBM).

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