For those looking to find strong Basic Materials stocks, it is prudent to search for companies in the group that are outperforming their peers. Albemarle (ALB) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? By taking a look at the stock's year-to-date performance in comparison to its Basic Materials peers, we might be able to answer that question.
Albemarle is one of 248 companies in the Basic Materials group. The Basic Materials group currently sits at #10 within the Zacks Sector Rank. The Zacks Sector Rank gauges the strength of our 16 individual sector groups by measuring the average Zacks Rank of the individual stocks within the groups.
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. Albemarle is currently sporting a Zacks Rank of #1 (Strong Buy).
Over the past 90 days, the Zacks Consensus Estimate for ALB's full-year earnings has moved 57.3% higher. This shows that analyst sentiment has improved and the company's earnings outlook is stronger.
Based on the most recent data, ALB has returned 25.5% so far this year. Meanwhile, stocks in the Basic Materials group have gained about 15.6% on average. This shows that Albemarle is outperforming its peers so far this year.
Another Basic Materials stock, which has outperformed the sector so far this year, is Green Plains Renewable Energy (GPRE). The stock has returned 59.9% year-to-date.
For Green Plains Renewable Energy, the consensus EPS estimate for the current year has increased 359.9% over the past three months. The stock currently has a Zacks Rank #1 (Strong Buy).
Looking more specifically, Albemarle belongs to the Chemical - Diversified industry, a group that includes 29 individual stocks and currently sits at #144 in the Zacks Industry Rank. On average, stocks in this group have gained 27.6% this year, meaning that ALB is slightly underperforming its industry in terms of year-to-date returns.
In contrast, Green Plains Renewable Energy falls under the Chemical - Specialty industry. Currently, this industry has 44 stocks and is ranked #107. Since the beginning of the year, the industry has moved +11%.
Going forward, investors interested in Basic Materials stocks should continue to pay close attention to Albemarle and Green Plains Renewable Energy as they could maintain their solid performance.
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Albemarle Corporation (ALB): Free Stock Analysis Report
Green Plains, Inc. (GPRE): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).