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VALE S.A. (VALE) Gains But Lags Market: What You Should Know

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VALE S.A. (VALE - Free Report) closed at $21.63 in the latest trading session, marking a +1.31% move from the prior day. This move lagged the S&P 500's daily gain of 1.52%.

Coming into today, shares of the company had lost 2.95% in the past month. In that same time, the Basic Materials sector gained 1.24%, while the S&P 500 gained 2.41%.

Investors will be hoping for strength from VALE as it approaches its next earnings release. The company is expected to report EPS of $1.40, up 536.36% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $16.95 billion, up 125.47% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.37 per share and revenue of $66.81 billion, which would represent changes of +154.5% and +66.94%, respectively, from the prior year.

Any recent changes to analyst estimates for VALE should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 7.03% higher. VALE is currently a Zacks Rank #2 (Buy).

Valuation is also important, so investors should note that VALE has a Forward P/E ratio of 3.98 right now. Its industry sports an average Forward P/E of 4.63, so we one might conclude that VALE is trading at a discount comparatively.

Also, we should mention that VALE has a PEG ratio of 0.12. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Mining - Iron industry currently had an average PEG ratio of 0.12 as of yesterday's close.

The Mining - Iron industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 3, which puts it in the top 2% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow VALE in the coming trading sessions, be sure to utilize Zacks.com.


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