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

Zacks Equity Research
·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. Has Rio Tinto (RIO) been one of those stocks this year? 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 244 individual stocks and currently holds a Zacks Sector Rank of #5. 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. Rio Tinto is currently sporting a Zacks Rank of #2 (Buy).

The Zacks Consensus Estimate for RIO's full-year earnings has moved 39.8% higher within the past quarter. This means that analyst sentiment is stronger and the stock's earnings outlook is improving.

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Based on the latest available data, RIO has gained about 18.8% so far this year. Meanwhile, stocks in the Basic Materials group have gained about 7.2% on average. This means that Rio Tinto is performing better than its sector in terms of year-to-date returns.

Golden Minerals (AUMN) is another Basic Materials stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 54.6%.

For Golden Minerals, the consensus EPS estimate for the current year has increased 100% over the past three months. The stock currently has a Zacks Rank #2 (Buy).

Looking more specifically, Rio Tinto belongs to the Mining - Miscellaneous industry, which includes 50 individual stocks and currently sits at #80 in the Zacks Industry Rank. Stocks in this group have gained about 22.2% so far this year, so RIO is slightly underperforming its industry this group in terms of year-to-date returns. Golden Minerals is also part of the same industry.

Rio Tinto and Golden Minerals 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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