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Has Rio Tinto (RIO) Outpaced Other Basic Materials Stocks This Year?

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The Basic Materials group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. Is Rio Tinto (RIO) one of those stocks right now? 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.

Rio Tinto is a member of the Basic Materials sector. This group includes 242 individual stocks and currently holds a Zacks Sector Rank of #6. The Zacks Sector Rank considers 16 different groups, measuring the average Zacks Rank of the individual stocks within the sector to gauge the strength of each group.

The Zacks Rank emphasizes earnings estimates and estimate revisions to find stocks with improving earnings outlooks. This system has a long record of success, and these stocks tend to be on track to beat the market over the next one to three months. Rio Tinto is currently sporting a Zacks Rank of #2 (Buy).

Within the past quarter, the Zacks Consensus Estimate for RIO's full-year earnings has moved 44.5% higher. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive.

Our latest available data shows that RIO has returned about 16.3% since the start of the calendar year. Meanwhile, stocks in the Basic Materials group have gained about 13.7% on average. As we can see, Rio Tinto is performing better than its sector in the calendar year.

Glencore PLC (GLNCY) is another Basic Materials stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 29.9%.

In Glencore PLC's case, the consensus EPS estimate for the current year increased 17% over the past three months. The stock currently has a Zacks Rank #2 (Buy).

To break things down more, Rio Tinto belongs to the Mining - Miscellaneous industry, a group that includes 50 individual companies and currently sits at #69 in the Zacks Industry Rank. This group has gained an average of 26.7% so far this year, so RIO is slightly underperforming its industry in this area. Glencore PLC is also part of the same industry.

Investors with an interest in Basic Materials stocks should continue to track Rio Tinto and Glencore PLC. These stocks will be looking to continue their solid performance.


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