Chevron Corp (CVX): 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

Chevron ( CVX) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day down 1.4%. By the end of trading, Chevron fell $2.36 (-1.9%) to $122.75 on average volume. Throughout the day, 7,532,275 shares of Chevron exchanged hands as compared to its average daily volume of 6,304,400 shares. The stock ranged in price between $122.75-$125.30 after having opened the day at $124.64 as compared to the previous trading day's close of $125.11. Other companies within the Basic Materials sector that declined today were: Mechel OAO ( MTL), down 15.2%, Polymet Mining ( PLM), down 11.8%, Quaterra Resources ( QMM), down 11.7% and Fortuna Silver Mines ( FSM), down 11.7%.
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Chevron Corporation, through its subsidiaries, engages in petroleum, chemicals, mining, power generation, and energy operations worldwide. The company operates in two segments, Upstream and Downstream. Chevron has a market cap of $243.3 billion and is part of the energy industry. The company has a P/E ratio of 9.5, below the S&P 500 P/E ratio of 17.7. Shares are up 16.0% year to date as of the close of trading on Thursday. Currently there are 12 analysts that rate Chevron a buy, no analysts rate it a sell, and 3 rate it a hold.

TheStreet Ratings rates Chevron as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

On the positive front, Houston American Energy Corporation ( HUSA), down 21.1%, Torch Energy Royalty ( TRU), down 20.0%, Kimber Resources ( KBX), down 17.8% and Constellation Energy Partners ( CEP), down 14.8% , were all gainers within the basic materials sector with Anglogold Ashanti ( AU) 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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