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SQM (SQM) Gains As Market Dips: What You Should Know

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In the latest trading session, SQM (SQM - Free Report) closed at $84.80, marking a +0.31% move from the previous day. This change outpaced the S&P 500's 1.56% loss on the day. Elsewhere, the Dow lost 1.81%, while the tech-heavy Nasdaq lost 4.66%.

Coming into today, shares of the chemicals company had lost 0.83% in the past month. In that same time, the Basic Materials sector gained 8.09%, while the S&P 500 gained 3.82%.

Investors will be hoping for strength from SQM as it approaches its next earnings release. On that day, SQM is projected to report earnings of $3.80 per share, which would represent year-over-year growth of 236.28%. Meanwhile, our latest consensus estimate is calling for revenue of $3.11 billion, up 187.03% from the prior-year quarter.

It is also important to note the recent changes to analyst estimates for SQM. These revisions help to show the ever-changing nature of 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. 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.

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. Within the past 30 days, our consensus EPS projection remained stagnant. SQM currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, SQM is holding a Forward P/E ratio of 5.36. Its industry sports an average Forward P/E of 6.11, so we one might conclude that SQM is trading at a discount comparatively.

Investors should also note that SQM has a PEG ratio of 0.36 right now. 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 Fertilizers industry currently had an average PEG ratio of 0.79 as of yesterday's close.

The Fertilizers industry is part of the Basic Materials sector. This industry currently has a Zacks Industry Rank of 239, which puts it in the bottom 6% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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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