The following are the top rated Basic Materials stocks according to Validea's P/E/Growth Investor model based on the published strategy of Peter Lynch. This strategy looks for stocks trading at a reasonable price relative to earnings growth that also possess strong balance sheets.
ADVANSIX INC (ASIX) is a small-cap value stock in the Chemicals - Plastics & Rubber industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: AdvanSix Inc. is a manufacturer of Nylon 6, a polymer resin which is a synthetic material used by its customers to produce fibers, filaments, engineered plastics and films that, in turn, are used in such end-products as such as building and construction, fertilizers, plastics, solvents, packaging, paints, coatings, adhesives and electronics. It also sells caprolactam, ammonium sulfate fertilizer, acetone and other intermediate chemicals, all of which are produced within unit operations across its integrated manufacturing value chain. It sells its Nylon 6 resin globally, primarily under the Aegis brand name. In addition, its Nylon 6 resin is used to produce nylon films which it sells to its customers primarily under the Capran brand name. Caprolactam is the key monomer used in the production of Nylon 6 resin. Its Ammonium sulfate fertilizer is derived from the caprolactam manufacturing process and sells ammonium sulfate primarily to North American and South American distributors.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| P/E/GROWTH RATIO: | PASS |
| SALES AND P/E RATIO: | PASS |
| INVENTORY TO SALES: | PASS |
| EPS GROWTH RATE: | PASS |
| TOTAL DEBT/EQUITY RATIO: | PASS |
| FREE CASH FLOW: | NEUTRAL |
| NET CASH POSITION: | NEUTRAL |
Detailed Analysis of ADVANSIX INC
BHP GROUP LTD (ADR) (BHP) is a large-cap value stock in the Metal Mining industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: BHP Group Ltd is a global resources company. The Company is a producer of various commodities, including copper and uranium, copper smelter, copper refinery and precious metals. The Company's segments include Petroleum, Copper, Iron Ore and Coal. The Petroleum segment is engaged in the exploration, development and production of oil and gas. The Copper segment is engaged in mining of copper, silver, zinc, molybdenum, uranium and gold. The Iron Ore segment is engaged in mining of iron ore. The Coal segment is engaged in mining of metallurgical coal and energy coal. The Company extracts and processes minerals, oil and gas from its production operations located primarily in Australia and the Americas. Its businesses include Minerals Australia, Minerals Americas, Petroleum.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| P/E/GROWTH RATIO: | PASS |
| SALES AND P/E RATIO: | PASS |
| INVENTORY TO SALES: | PASS |
| EPS GROWTH RATE: | PASS |
| TOTAL DEBT/EQUITY RATIO: | PASS |
| FREE CASH FLOW: | NEUTRAL |
| NET CASH POSITION: | NEUTRAL |
Detailed Analysis of BHP GROUP LTD (ADR)
CLEVELAND-CLIFFS INC (CLF) is a large-cap value stock in the Metal Mining industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Cleveland-Cliffs Inc. is an integrated mining and flat-rolled steel producer. It is engaged in manufacturing iron ore pellets. It is vertically integrated from mined raw materials, direct reduced iron and ferrous scrap to primary steelmaking and downstream finishing, stamping, tooling, and tubing. It offers advanced high-strength steels (AHSS), hot-dipped galvanized, aluminized, galvalume, electrogalvanized, galvanneal, hot-rolled coil (HRC), cold-rolled coil, plate, tinplate, grain oriented electrical steel (GOES), non-oriented electrical steel (NOES), stainless steels, tool and die, stamped components, rail, slab and cast ingot. It provides steel solutions, such as operations of tooling and stamping, which provides advanced-engineered solutions, tool design and build, hot and cold-stamped components, and complex assemblies for the automotive market. It serves various markets, such as automotive, infrastructure and manufacturing, steel producers, and distributors and converters.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| P/E/GROWTH RATIO: | PASS |
| SALES AND P/E RATIO: | PASS |
| INVENTORY TO SALES: | PASS |
| EPS GROWTH RATE: | PASS |
| TOTAL DEBT/EQUITY RATIO: | PASS |
| FREE CASH FLOW: | NEUTRAL |
| NET CASH POSITION: | NEUTRAL |
Detailed Analysis of CLEVELAND-CLIFFS INC
DOW INC (DOW) is a large-cap value stock in the Chemicals - Plastics & Rubber industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Dow Inc. is a holding company for The Dow Chemical Company and its subsidiaries (TDCC). The Company conducts its worldwide operations through six global businesses, which are organized into three segments: Packaging & Specialty Plastics, Industrial Intermediates & Infrastructure, and Performance Materials & Coatings. The Packaging & Specialty Plastics segment consists of two integrated global businesses, such as Hydrocarbons & Energy and Packaging and Specialty Plastics. The Industrial Intermediates & Infrastructure segment consists of two customer-centric global businesses, such as Industrial Solutions and Polyurethanes & Construction Chemicals that develop intermediate chemicals that are essential to manufacturing processes, as well as downstream, customized materials and formulations that use advanced development technologies. The Performance Materials & Coatings segment consists of two global businesses, such as Coatings & Performance Monomers and Consumer Solutions.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| INVENTORY TO SALES: | PASS |
| YIELD ADJUSTED P/E TO GROWTH (PEG) RATIO: | PASS |
| EARNINGS PER SHARE: | PASS |
| TOTAL DEBT/EQUITY RATIO: | PASS |
| FREE CASH FLOW: | NEUTRAL |
| NET CASH POSITION: | NEUTRAL |
Detailed Analysis of DOW INC
FREEPORT-MCMORAN INC (FCX) is a large-cap value stock in the Metal Mining industry. The rating according to our strategy based on Peter Lynch is 93% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
Company Description: Freeport-McMoRan Inc. (FCX) is a mining company. The Company operates through geographical assets with proven and probable reserves of copper, gold and molybdenum, and traded copper producer. The Company's segments include refined copper products, copper in concentrate, gold, molybdenum, oil and other. The Company's segments include the Morenci, Cerro Verde, Grasberg copper mines, the Rod & Refining operations and the United States (U.S.) Oil and Gas Operations. The Company has organized its operations into five divisions, which include North America copper mines, South America mining, Indonesia mining and Molybdenum mines. The Company's portfolio of assets includes the Grasberg minerals district in Indonesia, copper and gold deposits, and mining operations in the Americas, including the large-scale Morenci minerals district in North America and the Cerro Verde operation in South America.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
| P/E/GROWTH RATIO: | PASS |
| SALES AND P/E RATIO: | PASS |
| INVENTORY TO SALES: | PASS |
| EPS GROWTH RATE: | PASS |
| TOTAL DEBT/EQUITY RATIO: | PASS |
| FREE CASH FLOW: | NEUTRAL |
| NET CASH POSITION: | NEUTRAL |
Detailed Analysis of FREEPORT-MCMORAN INC
More details on Validea's Peter Lynch strategy
About Peter Lynch: Perhaps the greatest mutual fund manager of all-time, Lynch guided Fidelity Investment's Magellan Fund to a 29.2 percent average annual return from 1977 until his retirement in 1990, almost doubling the S&P 500's 15.8 percent yearly return over that time. Lynch's common sense approach and quick wit made him one of the most quoted investors on Wall Street. ("Go for a business that any idiot can run -- because sooner or later, any idiot probably is going to run it," is one of his many pearls of wisdom.) Lynch's bestseller One Up on Wall Street is something of a "stocks for the everyman/everywoman", breaking his approach down into easy-to-understand concepts.
About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
