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Is Gerdau (GGB) Outperforming Other Basic Materials Stocks This Year?

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Investors interested in Basic Materials stocks should always be looking to find the best-performing companies in the group. Gerdau (GGB) 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.

Gerdau is a member of the Basic Materials sector. This group includes 244 individual stocks and currently holds a Zacks Sector Rank of #5. The Zacks Sector Rank includes 16 different groups and is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors.

The Zacks Rank is a proven system that emphasizes earnings estimates and estimate revisions, highlighting a variety of stocks that are displaying the right characteristics to beat the market over the next one to three months. Gerdau is currently sporting a Zacks Rank of #2 (Buy).

Within the past quarter, the Zacks Consensus Estimate for GGB's full-year earnings has moved 14.6% higher. This shows that analyst sentiment has improved and the company's earnings outlook is stronger.

Our latest available data shows that GGB has returned about 17.5% since the start of the calendar year. Meanwhile, stocks in the Basic Materials group have gained about 9.2% on average. This means that Gerdau is outperforming the sector as a whole this year.

Another Basic Materials stock, which has outperformed the sector so far this year, is VALE S.A. (VALE). The stock has returned 43.7% year-to-date.

Over the past three months, VALE S.A.'s consensus EPS estimate for the current year has increased 37.8%. The stock currently has a Zacks Rank #1 (Strong Buy).

Looking more specifically, Gerdau belongs to the Steel - Producers industry, which includes 23 individual stocks and currently sits at #41 in the Zacks Industry Rank. On average, stocks in this group have gained 10.1% this year, meaning that GGB is performing better in terms of year-to-date returns.

VALE S.A. however, belongs to the Mining - Iron industry. Currently, this 2-stock industry is ranked #1. The industry has moved +43.6% so far this year.

Investors interested in the Basic Materials sector may want to keep a close eye on Gerdau and VALE S.A. as they attempt to continue their solid performance.


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