Petroleo Brasileiro SA Petrobras (PBR): 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

Petroleo Brasileiro SA Petrobras ( PBR) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day down 0.9%. By the end of trading, Petroleo Brasileiro SA Petrobras fell $0.61 (-3.2%) to $18.36 on average volume. Throughout the day, 19,533,457 shares of Petroleo Brasileiro SA Petrobras exchanged hands as compared to its average daily volume of 16,386,800 shares. The stock ranged in price between $18.21-$19.12 after having opened the day at $18.91 as compared to the previous trading day's close of $18.97. Other companies within the Basic Materials sector that declined today were: GeoPetro Resources Company ( GPR), down 25.0%, Torch Energy Royalty ( TRU), down 23.3%, Whiting USA Trust I ( WHX), down 14.9% and FX Energy ( FXEN), down 13.9%.
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Petroleo Brasileiro S.A. operates as an integrated oil and gas company in Brazil and internationally. Petroleo Brasileiro SA Petrobras has a market cap of $123.3 billion and is part of the energy industry. The company has a P/E ratio of 11.1, below the S&P 500 P/E ratio of 17.7. Shares are down 2.6% year to date as of the close of trading on Tuesday. Currently there are 2 analysts that rate Petroleo Brasileiro SA Petrobras a buy, no analysts rate it a sell, and 8 rate it a hold.

TheStreet Ratings rates Petroleo Brasileiro SA Petrobras as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, attractive valuation levels and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, poor profit margins and weak operating cash flow.

On the positive front, Recon Technology ( RCON), down 32.5%, China Shen Zhou Mining & Resources ( SHZ), down 21.7%, Crosshair Energy ( CXZ), down 20.0% and North American Energy Partners Incorporate ( NOA), down 18.6% , were all gainers within the basic materials sector with HollyFrontier ( HFC) 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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