Seadrill Ltd (SDRL): Today's Featured Basic Materials Laggard

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Seadrill ( SDRL) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day up 1.2%. By the end of trading, Seadrill fell $0.69 (-1.8%) to $37.06 on heavy volume. Throughout the day, 6,958,337 shares of Seadrill exchanged hands as compared to its average daily volume of 2,864,900 shares. The stock ranged in price between $36.67-$37.54 after having opened the day at $36.94 as compared to the previous trading day's close of $37.75. Other companies within the Basic Materials sector that declined today were: Quaterra Resources ( QMM), down 11.5%, China Gengsheng Minerals ( CHGS), down 9.4%, Prospect Global Resources ( PGRX), down 7.1% and North American Palladium ( PAL), down 6.8%.

Seadrill Limited provides offshore drilling services to the oil and gas industry worldwide. The company operates in three segments: Floaters, Jack-up Rigs, and Tender Rigs. Seadrill has a market cap of $17.7 billion and is part of the energy industry. The company has a P/E ratio of 7.9, below the S&P 500 P/E ratio of 17.7. Shares are down 8.1% year to date as of the close of trading on Monday. Currently there are 5 analysts that rate Seadrill a buy, 1 analyst rates it a sell, and 5 rate it a hold.

TheStreet Ratings rates Seadrill as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity, compelling growth in net income, good cash flow from operations and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

On the positive front, Recon Technology ( RCON), up 38.2%, Houston American Energy Corporation ( HUSA), up 18.9%, AK Steel Holding Corporation ( AKS), up 18.7% and Minco Gold Corporation ( MGH), up 17.2% , were all gainers within the basic materials sector with Hess ( HES) 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).

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.

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