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Are Basic Materials Stocks Lagging DRDGOLD Limited (DRD) This Year?

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For those looking to find strong Basic Materials stocks, it is prudent to search for companies in the group that are outperforming their peers. Is DRDGOLD (DRD - Free Report) 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.

DRDGOLD is one of 241 individual stocks in the Basic Materials sector. Collectively, these companies sit at #11 in the Zacks Sector Rank. 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 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. DRDGOLD is currently sporting a Zacks Rank of #2 (Buy).

The Zacks Consensus Estimate for DRD's full-year earnings has moved 7.5% higher within the past quarter. This signals that analyst sentiment is improving and the stock's earnings outlook is more positive.

Based on the latest available data, DRD has gained about 1% so far this year. In comparison, Basic Materials companies have returned an average of -4.7%. This shows that DRDGOLD is outperforming its peers so far this year.

Another Basic Materials stock, which has outperformed the sector so far this year, is Ecolab (ECL - Free Report) . The stock has returned 22.6% year-to-date.

In Ecolab's case, the consensus EPS estimate for the current year increased 2.6% over the past three months. The stock currently has a Zacks Rank #2 (Buy).

Breaking things down more, DRDGOLD is a member of the Mining - Gold industry, which includes 40 individual companies and currently sits at #76 in the Zacks Industry Rank. On average, stocks in this group have gained 6.2% this year, meaning that DRD is slightly underperforming its industry in terms of year-to-date returns.

In contrast, Ecolab falls under the Chemical - Specialty industry. Currently, this industry has 33 stocks and is ranked #156. Since the beginning of the year, the industry has moved -19.7%.

Investors with an interest in Basic Materials stocks should continue to track DRDGOLD and Ecolab. These stocks will be looking to continue their solid performance.


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