Are Basic Materials Stocks Lagging Dow (DOW) This Year?

For those looking to find strong Basic Materials stocks, it is prudent to search for companies in the group that are outperforming their peers. Is Dow Inc. (DOW) one of those stocks right now? Let's take a closer look at the stock's year-to-date performance to find out.

Dow Inc. is a member of our Basic Materials group, which includes 275 different companies and currently sits at #9 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 different sector groups. The average Zacks Rank of the individual stocks within the groups is measured, and the sectors are listed from best to worst.

The Zacks Rank is a successful stock-picking model that emphasizes earnings estimates and estimate revisions. The system highlights a number of different stocks that could be poised to outperform the broader market over the next one to three months. Dow Inc. is currently sporting a Zacks Rank of #1 (Strong Buy).

Over the past three months, the Zacks Consensus Estimate for DOW's full-year earnings has moved 37652.7% higher. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.

Our latest available data shows that DOW has returned about 17% since the start of the calendar year. At the same time, Basic Materials stocks have gained an average of 8.1%. This shows that Dow Inc. is outperforming its peers so far this year.

Green Plains Renewable Energy (GPRE) is another Basic Materials stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 56.9%.

Over the past three months, Green Plains Renewable Energy's consensus EPS estimate for the current year has increased 359.9%. The stock currently has a Zacks Rank #1 (Strong Buy).

To break things down more, Dow Inc. belongs to the Chemical - Diversified industry, a group that includes 31 individual companies and currently sits at #106 in the Zacks Industry Rank. On average, this group has gained an average of 15.4% so far this year, meaning that DOW is performing better in terms of year-to-date returns.

Green Plains Renewable Energy, however, belongs to the Chemical - Specialty industry. Currently, this 46-stock industry is ranked #93. The industry has moved +15% so far this year.

Going forward, investors interested in Basic Materials stocks should continue to pay close attention to Dow Inc. and Green Plains Renewable Energy as they could maintain their solid performance.

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This article originally published on Zacks Investment Research (zacks.com).

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