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Tickers in this Article: KS, CE, PKG, RGLD, CLF, SQM, ARG
The Nasdaq has been relatively flat, the S&P 500 has declined 0.3% and the Dow has remained steady after the morning's trading. 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.

On a quiet day for the market overall so far, the Basic Materials sector (XLB) has slipped 0.6% and its biggest movers are currently:
CompanyMarket CapPercentage Change
KapStone Paper and (NYSE:KS)$899.3 million+8.2%
Celanese (NYSE:CE)$6.61 billion-3.8%
Packaging Corp Of (NYSE:PKG)$3.17 billion+2.7%
Royal Gold (Nasdaq:RGLD)$5.59 billion+2.6%
Cliffs Natural Resources (NYSE:CLF)$6.17 billion-2.3%
Sociedad Quimica y Minera (NYSE:SQM)$16.86 billion-2.3%
Airgas (NYSE:ARG)$6.37 billion+1.8%
Forex Broker Summary: UFXMarkets

Increasing 8.2%, KapStone Paper and (NYSE:KS) is trading at $20.92 per share. The company's volume for the day so far is 482,799 shares. Yesterday, volume was only 254,922 shares. 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. Investors can make use of valuation ratios to estimate whether a stock is fairly valued. The debt-equity (D/E) ratio compares the total liabilities for a company to its total shareholder equity. KS has a D/E ratio of 50%. The D/E ratio percentage provides a much more dramatic perspective on a company's leverage position than the debt ratio percentage.

Celanese (NYSE:CE) has fallen 3.8% and is currently trading at $40.43 per share. The company's volume for the day so far is 1.5 million shares, one times its current three-month average. High volume indicates a lot of investor interest while low volume indicates the opposite. Investors can use valuation ratios as tools to estimate what kind of deal a particular investment is. The price/book value ratio is one of the more common methods of determining whether a stock is fairly valued. CE's stock is trading for more than its book value with a P/B ratio of 3.62. It is important to take the company's debt into account when using the P/B ratio as debt can boost a company's liabilities to the point where they wipe out much of the book value of its hard assets, creating artificially high P/B values. 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

Packaging Corp Of (NYSE:PKG) is currently trading at $33.93 per share, a 2.7% increase. So far today, the company's volume is 864,758 shares. High volume indicates a lot of investor interest while low volume indicates the opposite. Understanding investment valuation ratios allows an investor to assess the true value of an individual stock. The dividend yield is measured by taking the annual dividends per share and dividing that number by the stock price. Dividend yield for PKG is 3.1%. It is important to remember that dividends are only one component of a stock's return and capital appreciation (or decline) must also be considered when evaluating a security. SEE: Dividend Yield For The Downturn

Increasing 2.6%, Royal Gold (Nasdaq:RGLD) is trading at $96.71 per share. The company's volume is currently 563,137 shares for the day, 0.7 times its current daily average. High volume indicates a lot of investor interest while low volume indicates the opposite. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. In a nutshell, the price/sales ratio shows how much Wall Street values every dollar of the company's sales. RGLD's P/S ratio of 17.46 is on the high side. In young companies, a high P/S ratio is a sign of sales growth that is expected to turn into earnings and cash flow. All things being equal, a low P/S ratio is good news for investors, while a very high one can be a warning sign.

Cliffs Natural Resources (NYSE:CLF) is down 2.3% to reach $41.52 per share. The company's volume is currently 4.3 million shares. This is on pace to fall short of yesterday's volume of 11.1 million shares. If a stock price makes a big move up or down, volume lets us know the significance of that move. Investment valuation ratios provide investors with an estimation, albeit a simplistic one, of the value of a stock. The debt ratio shows the proportion of assets that a company is financing through debt. CLF's debt ratio is 58.6%. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.

Sociedad Quimica y Minera (NYSE:SQM) is trading at $63.61 per share, down 2.3%. With 133,129 shares changing hands so far today, the company's volume is 0.3 times its average over the past three months. The trading volume for a stock indicates the level of investor interest. A company's value as an investment is more easily 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. The price/earnings to growth (PEG) ratio divides a company's P/E ratio by its growth rate of earnings-per-share. PEG ratio for SQM is consistent with the industry average at 1.45. While P/E ratios are important indicators of market value, a high P/E in and of itself is not bad because it may indicate a company whose earnings are growing very rapidly, so many investors look at the PEG ratio in order to get an idea of whether or not a particular P/E ratio is justified by underlying earnings growth.

Airgas (NYSE:ARG) has moved up 1.8% and is currently trading at $85.37 per share. So far today, 260,276 shares have changed hands. Volume indicates the level of interest that investors have in a company at its current price. Investment valuation ratios can be very useful in estimating whether a stock price is too high, reasonable or a bargain investment opportunity. The capitalization ratio is calculated by dividing long-term debt by the sum of long-term debt and shareholders' equity. ARG's capitalization ratio is 48.8%. 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.

The Bottom Line On any given day, a particular stock may see positive or negative change in its share price. Daily stock performance should be weighed against historical performance and put in context of the market overall. Keep in mind that all these ratios should be compared against historical numbers and industry information in order to get a more complete picture.

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