3 Stocks Dragging In The Basic Materials Sector

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.

All three major indices are trading up today with the Dow Jones Industrial Average ( ^DJI) trading up 91 points (0.6%) at 15,720 as of Friday, Feb. 7, 2014, 11:55 AM ET. The NYSE advances/declines ratio sits at 2,156 issues advancing vs. 753 declining with 162 unchanged.

The Basic Materials sector currently sits up 0.6% versus the S&P 500, which is up 0.6%. On the negative front, top decliners within the sector include Baytex Energy ( BTE), down 5.7%, FMC Technologies ( FTI), down 3.5%, Encana ( ECA), down 2.6%, Ultrapar Holdings ( UGP), down 2.4% and Cabot Oil & Gas Corporation ( COG), down 1.9%. Top gainers within the sector include Statoil ASA ( STO), up 5.3%, Valero Energy Corporation ( VLO), up 2.9%, Goldcorp ( GG), up 2.6%, Marathon Petroleum ( MPC), up 2.5% and Noble Energy ( NBL), up 2.3%.

TheStreet would like to highlight 3 stocks pushing the sector lower today:

3. POSCO ( PKX) is one of the companies pushing the Basic Materials sector lower today. As of noon trading, POSCO is down $1.01 (-1.5%) to $67.23 on heavy volume. Thus far, 189,386 shares of POSCO exchanged hands as compared to its average daily volume of 235,500 shares. The stock has ranged in price between $67.11-$68.00 after having opened the day at $67.34 as compared to the previous trading day's close of $68.24.

POSCO, together with its subsidiaries, primarily manufactures and sells integrated steel products in South Korea. It operates through four segments: Steel, Trading, Construction, and Others. POSCO has a market cap of $21.4 billion and is part of the metals & mining industry. Shares are down 12.5% year-to-date as of the close of trading on Thursday. Currently there are no analysts that rate POSCO a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates POSCO as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and a generally disappointing performance in the stock itself. Get the full POSCO Ratings Report now.

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

2. As of noon trading, Diamond Offshore Drilling ( DO) is down $1.74 (-3.7%) to $45.57 on heavy volume. Thus far, 1.6 million shares of Diamond Offshore Drilling exchanged hands as compared to its average daily volume of 1.4 million shares. The stock has ranged in price between $45.52-$47.22 after having opened the day at $47.06 as compared to the previous trading day's close of $47.31.

Diamond Offshore Drilling, Inc. operates as an offshore oil and gas drilling contractor worldwide. It provides offshore drilling services in both the floater market, such as ultra-deepwater, deepwater, and mid-water; and in the non-floater and jack-up markets. Diamond Offshore Drilling has a market cap of $6.5 billion and is part of the energy industry. Shares are down 16.9% year-to-date as of the close of trading on Thursday. Currently there are 2 analysts that rate Diamond Offshore Drilling a buy, 6 analysts rate it a sell, and 9 rate it a hold.

TheStreet Ratings rates Diamond Offshore Drilling as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity. Get the full Diamond Offshore Drilling Ratings Report now.

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

1. As of noon trading, Southwestern Energy Company ( SWN) is down $0.64 (-1.5%) to $41.81 on average volume. Thus far, 2.6 million shares of Southwestern Energy Company exchanged hands as compared to its average daily volume of 3.5 million shares. The stock has ranged in price between $41.17-$42.60 after having opened the day at $42.49 as compared to the previous trading day's close of $42.45.

Southwestern Energy Company, an independent energy company, engages in the exploration, development, and production of natural gas and oil primarily in the United States. The company operates through two segments, Exploration and Production, and Midstream Services. Southwestern Energy Company has a market cap of $14.8 billion and is part of the energy industry. Shares are up 7.9% year-to-date as of the close of trading on Thursday. Currently there are 6 analysts that rate Southwestern Energy Company a buy, 1 analyst rates it a sell, and 18 rate it a hold.

TheStreet Ratings rates Southwestern Energy Company as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income, good cash flow from operations, expanding profit margins and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated. Get the full Southwestern Energy Company Ratings Report now.

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

If you are interested in one of these 5 stocks, 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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