Are Basic Materials Stocks Lagging ATI Inc. (ATI) This Year?

·2 min read

For those looking to find strong Basic Materials stocks, it is prudent to search for companies in the group that are outperforming their peers. Allegheny Technologies (ATI) is a stock that can certainly grab the attention of many investors, but do its recent returns compare favorably to the sector as a whole? A quick glance at the company's year-to-date performance in comparison to the rest of the Basic Materials sector should help us answer this question.

Allegheny Technologies is a member of our Basic Materials group, which includes 238 different companies and currently sits at #8 in the Zacks Sector Rank. The Zacks Sector Rank considers 16 different sector groups. The average Zacks Rank of the individual stocks within the groups is measured, and the sectors are listed from best to worst.

The Zacks Rank is a successful stock-picking model that emphasizes earnings estimates and estimate revisions. The system highlights a number of different stocks that could be poised to outperform the broader market over the next one to three months. Allegheny Technologies is currently sporting a Zacks Rank of #1 (Strong Buy).

Over the past three months, the Zacks Consensus Estimate for ATI's full-year earnings has moved 3.9% higher. This is a sign of improving analyst sentiment and a positive earnings outlook trend.

According to our latest data, ATI has moved about 34.3% on a year-to-date basis. At the same time, Basic Materials stocks have gained an average of 9%. As we can see, Allegheny Technologies is performing better than its sector in the calendar year.

One other Basic Materials stock that has outperformed the sector so far this year is Veritiv (VRTV). The stock is up 20.6% year-to-date.

Over the past three months, Veritiv's consensus EPS estimate for the current year has increased 5%. The stock currently has a Zacks Rank #1 (Strong Buy).

Breaking things down more, Allegheny Technologies is a member of the Steel - Speciality industry, which includes 4 individual companies and currently sits at #21 in the Zacks Industry Rank. On average, this group has gained an average of 34.1% so far this year, meaning that ATI is performing better in terms of year-to-date returns.

In contrast, Veritiv falls under the Paper and Related Products industry. Currently, this industry has 14 stocks and is ranked #15. Since the beginning of the year, the industry has moved +6%.

Allegheny Technologies and Veritiv could continue their solid performance, so investors interested in Basic Materials stocks should continue to pay close attention to these stocks.

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