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VALE S.A. (VALE) Laps the Stock Market: Here's Why

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VALE S.A. (VALE - Free Report) closed the most recent trading day at $9.18, moving +1.32% from the previous trading session. This change outpaced the S&P 500's 0.96% gain on the day. At the same time, the Dow added 0.89%, and the tech-heavy Nasdaq gained 0.94%.

The company's stock has dropped by 5.63% in the past month, falling short of the Basic Materials sector's gain of 0.57% and the S&P 500's gain of 0.5%.

Market participants will be closely following the financial results of VALE S.A. in its upcoming release. The company is forecasted to report an EPS of $0.44, showcasing a 2.33% upward movement from the corresponding quarter of the prior year. In the meantime, our current consensus estimate forecasts the revenue to be $10 billion, indicating a 0.78% growth compared to the corresponding quarter of the prior year.

Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $1.78 per share and revenue of $39.39 billion. These totals would mark changes of -2.2% and +3.5%, respectively, from last year.

Investors should also take note of any recent adjustments to analyst estimates for VALE S.A. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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 last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Right now, VALE S.A. possesses a Zacks Rank of #3 (Hold).

Digging into valuation, VALE S.A. currently has a Forward P/E ratio of 5.1. For comparison, its industry has an average Forward P/E of 5.1, which means VALE S.A. is trading at no noticeable deviation to the group.

Also, we should mention that VALE has a PEG ratio of 0.29. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. VALE's industry had an average PEG ratio of 0.29 as of yesterday's close.

The Mining - Iron industry is part of the Basic Materials sector. At present, this industry carries a Zacks Industry Rank of 101, placing it within the top 42% of over 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.

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


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