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Biggest Basic Materials Sector Movers, Including NEM
It's been a good morning for the market. The Nasdaq has climbed 1%; the S&P 500 has moved up 0.5%; and the Dow is up 0.6%. The basic materials sector is the category of stocks that accounts for companies involved with the discovery, development and processing of raw materials. This sector includes the mining and refining of metals, chemical producers and forestry products. The basic materials sector is sensitive to changes in the business cycle. Because the sector supplies materials for construction, it depends on a strong economy. This sector is also sensitive to supply and demand fluctuations because the price of raw materials, such as gold or other metals, is largely demand driven.
Underperforming the market overall, the Basic Materials sector (XLB) is up 0.9%, and these are its current biggest movers:
Broker Summary: E-Trade Financial
Coeur d'Alene (NYSE:CDE) is at $17.39 per share after an increase of 7.8%. The company's volume is currently 727,265 shares for the day, consistent with the volume from yesterday. In technical analysis, trading volume is used to determine the strength of a market indicator. Valuation ratios allow the investor to make a quick determination as to a company's investment value. The P/E ratio has been used for ages by analysts and still remains one of the most relevant pieces of stock valuation. CDE's P/E ratio of 17.2 is above the industry average of 1.94. This could mean that the market is expecting big things over the next few months or years. To determine the P/E ratio, an investor divides the market price of the stock by the earnings-per-share (EPS) of the stock. SEE: The P/E Ratio: A Good Market-Timing Indicator
After an increase of 4.7%, Newmont Mining (NYSE:NEM) has reached a current price of $46.76. So far today, 2.4 million shares have changed hands. A stock's volume conveys how excited investors are about it. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. A company's capitalization (not to be confused with its market capitalization) is the term used to describe the makeup of a company's permanent or long-term capital, which consists of both long-term debt and shareholders' equity. NEM's capitalization ratio is 36.3%. This ratio is considered to be one of the more meaningful of the "debt" ratios - it delivers the key insight into the use of leverage by a company.
Agnico-Eagle Mines Limited (NYSE:AEM) has moved up 3.9% and is currently trading at $45.34 per share. The company's volume is currently 741,911 shares for the day, 0.3 times its average over the past three months. Volume is an important indicator in technical analysis as it is used to measure the worth of a market move. If the markets have made a strong price move either up or down the perceived strength of that move depends on the volume for that period. The higher the volume during that price move the more significant the move. Understanding investment valuation ratios allows an investor to assess the true value of an individual stock. The price/book value ratio, often expressed simply as "price-to-book", provides investors a way to compare the market value, or what they are paying for each share, to a conservative measure of the value of the firm. AEM has a P/B ratio of 2.33 which shows that its share price is higher than its book value. This implies that investors expect management to create more value from a given set of assets and/or that the market value of the firm's assets is significantly higher than their accounting value. P/B value ratios are particularly useful to value investors, distressed or "vulture" investors, or any other investors purchasing beaten-down securities but are less useful to investors focused on growth stocks, purchasing IPOs, or investing in technology or other "asset-lite" companies. SEE: Using The Price-To-Book Ratio To Evaluate Companies
Randgold Resources Ltd (Nasdaq:GOLD) has risen 3% to hit a current price of $93.36 per share. The company's volume for the day so far is 185,801 shares. This is 0.4 times its average daily volume. If a stock price makes a big move up or down, volume lets us know the significance of that move. In making a decision about a potential or existing investment, valuation ratios are useful as a basis for seeing whether the stock price is too high, reasonable, or a bargain. Dividend yield measures the income that a stock will generate for an investor. GOLD has a low dividend yield of 0.4%. This may indicate that the company's stock is overpriced. To calculate the dividend yield, divide the level of dividends by the stock price; the higher the yield, the more attractive the security. SEE: Investment Valuation Ratios: Dividend Yield
Rising 2.9%, Stepan (NYSE:SCL) is currently trading at $91.54 per share. At 6,332 shares, the company's volume so far today is while it was 45,199 shares yesterday. If a stock is trading on low volume, then there is not much interest in the stock. On the other hand, if a stock is trading on high volume, then there is a lot of interest in the stock. A company's investment value can be estimated using valuation ratios such as the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield. While measuring a price/earnings ratio (P/E ratio) is a popular valuation technique, the measure cannot be calculated for companies without earnings, so some investors analyze the price/sales ratio. SCL has a low P/S ratio of 0.52. Low P/S ratios can indicate unrecognized value potential - so long as other criteria like high profit margins, low debt levels and growth prospects are in place. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.
Increasing 2.9%, Carpenter (NYSE:CRS) is trading at $49.79 per share. This morning, the company is trading a volume of 105,827 shares. If a stock price makes a big move up or down, volume lets us know the significance of that move. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. The debt ratio shows the proportion of assets that a company is financing through debt. CRS has a debt ratio of 58%. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.
Royal Gold (Nasdaq:RGLD) is currently trading at $79.72 per share, a 2.7% increase. The company's volume for the day so far is 204,007 shares, 0.3 times the current three-month average. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. A wide array of ratios can be used by investors to estimate the attractiveness of a potential or existing investment and get an idea of its valuation. The debt-equity (D/E) ratio is a leverage ratio. RGLD has a debt-equity ratio of 6%, which is on the low side. This shows that the company's assets are financed primarily through equity. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.
The Bottom Line On any given day, a particular stock may see positive or negative change in its share price. Paying close attention to the previous ratios will help you identify key times to adjust your strategy. Tools like valuation ratios and profit margins, however, are only as useful as the context you put them in; remember to take historical data and competitor performance into account.
Underperforming the market overall, the Basic Materials sector (XLB) is up 0.9%, and these are its current biggest movers:
| Company | Market Cap | Percentage Change |
| Coeur d\'Alene Mines Corporation (NYSE:CDE) | $1.45 billion | +7.8% |
| Newmont Mining (NYSE:NEM) | $21.94 billion | +4.7% |
| Agnico-Eagle Mines Limited (USA) (NYSE:AEM) | $7.48 billion | +3.9% |
| Randgold Resources Ltd. (ADR) (Nasdaq:GOLD) | $8.32 billion | +3% |
| Stepan Company (NYSE:SCL) | $919.9 million | +2.9% |
| Carpenter Technology Corporation (NYSE:CRS) | $2.53 billion | +2.9% |
| Royal Gold, Inc. (Nasdaq:RGLD) | $4.57 billion | +2.7% |
Coeur d'Alene (NYSE:CDE) is at $17.39 per share after an increase of 7.8%. The company's volume is currently 727,265 shares for the day, consistent with the volume from yesterday. In technical analysis, trading volume is used to determine the strength of a market indicator. Valuation ratios allow the investor to make a quick determination as to a company's investment value. The P/E ratio has been used for ages by analysts and still remains one of the most relevant pieces of stock valuation. CDE's P/E ratio of 17.2 is above the industry average of 1.94. This could mean that the market is expecting big things over the next few months or years. To determine the P/E ratio, an investor divides the market price of the stock by the earnings-per-share (EPS) of the stock. SEE: The P/E Ratio: A Good Market-Timing Indicator
After an increase of 4.7%, Newmont Mining (NYSE:NEM) has reached a current price of $46.76. So far today, 2.4 million shares have changed hands. A stock's volume conveys how excited investors are about it. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. A company's capitalization (not to be confused with its market capitalization) is the term used to describe the makeup of a company's permanent or long-term capital, which consists of both long-term debt and shareholders' equity. NEM's capitalization ratio is 36.3%. This ratio is considered to be one of the more meaningful of the "debt" ratios - it delivers the key insight into the use of leverage by a company.
Agnico-Eagle Mines Limited (NYSE:AEM) has moved up 3.9% and is currently trading at $45.34 per share. The company's volume is currently 741,911 shares for the day, 0.3 times its average over the past three months. Volume is an important indicator in technical analysis as it is used to measure the worth of a market move. If the markets have made a strong price move either up or down the perceived strength of that move depends on the volume for that period. The higher the volume during that price move the more significant the move. Understanding investment valuation ratios allows an investor to assess the true value of an individual stock. The price/book value ratio, often expressed simply as "price-to-book", provides investors a way to compare the market value, or what they are paying for each share, to a conservative measure of the value of the firm. AEM has a P/B ratio of 2.33 which shows that its share price is higher than its book value. This implies that investors expect management to create more value from a given set of assets and/or that the market value of the firm's assets is significantly higher than their accounting value. P/B value ratios are particularly useful to value investors, distressed or "vulture" investors, or any other investors purchasing beaten-down securities but are less useful to investors focused on growth stocks, purchasing IPOs, or investing in technology or other "asset-lite" companies. SEE: Using The Price-To-Book Ratio To Evaluate Companies
Rising 2.9%, Stepan (NYSE:SCL) is currently trading at $91.54 per share. At 6,332 shares, the company's volume so far today is while it was 45,199 shares yesterday. If a stock is trading on low volume, then there is not much interest in the stock. On the other hand, if a stock is trading on high volume, then there is a lot of interest in the stock. A company's investment value can be estimated using valuation ratios such as the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield. While measuring a price/earnings ratio (P/E ratio) is a popular valuation technique, the measure cannot be calculated for companies without earnings, so some investors analyze the price/sales ratio. SCL has a low P/S ratio of 0.52. Low P/S ratios can indicate unrecognized value potential - so long as other criteria like high profit margins, low debt levels and growth prospects are in place. A limitation of the P/S ratio is that the price component measures only stock market captialization, while sales are a function of the entire capital structure, potentially leading to wide differences between levered and unlevered companies.
Increasing 2.9%, Carpenter (NYSE:CRS) is trading at $49.79 per share. This morning, the company is trading a volume of 105,827 shares. If a stock price makes a big move up or down, volume lets us know the significance of that move. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. The debt ratio shows the proportion of assets that a company is financing through debt. CRS has a debt ratio of 58%. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.
Royal Gold (Nasdaq:RGLD) is currently trading at $79.72 per share, a 2.7% increase. The company's volume for the day so far is 204,007 shares, 0.3 times the current three-month average. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. A wide array of ratios can be used by investors to estimate the attractiveness of a potential or existing investment and get an idea of its valuation. The debt-equity (D/E) ratio is a leverage ratio. RGLD has a debt-equity ratio of 6%, which is on the low side. This shows that the company's assets are financed primarily through equity. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.
The Bottom Line On any given day, a particular stock may see positive or negative change in its share price. Paying close attention to the previous ratios will help you identify key times to adjust your strategy. Tools like valuation ratios and profit margins, however, are only as useful as the context you put them in; remember to take historical data and competitor performance into account.
by
Investopedia Staff
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