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VALE S.A. (VALE) Outpaces Stock Market Gains: What You Should Know

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VALE S.A. (VALE - Free Report) closed the most recent trading day at $17.47, moving +0.11% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.03%. At the same time, the Dow lost 0.04%, and the tech-heavy Nasdaq gained 0.55%.

Coming into today, shares of the company had gained 3.68% in the past month. In that same time, the Basic Materials sector gained 11.4%, while the S&P 500 gained 3.99%.

Investors will be hoping for strength from VALE as it approaches its next earnings release. On that day, VALE is projected to report earnings of $1.08 per share, which would represent year-over-year growth of 83.05%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $13.27 billion, up 33.18% from the year-ago period.

Investors might also notice recent changes to analyst estimates for VALE. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 14.73% higher. VALE is currently sporting a Zacks Rank of #1 (Strong Buy).

Digging into valuation, VALE currently has a Forward P/E ratio of 5.3. Its industry sports an average Forward P/E of 6.26, so we one might conclude that VALE is trading at a discount comparatively.

It is also worth noting that VALE currently has a PEG ratio of 0.24. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Mining - Iron stocks are, on average, holding a PEG ratio of 0.24 based on yesterday's closing prices.

The Mining - Iron industry is part of the Basic Materials sector. This group has a Zacks Industry Rank of 1, putting it in the top 1% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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