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31 May
Is DRDGOLD Limited (DRD) Stock Outpacing Its Basic Materials Peers This Year?

The Basic Materials group has plenty of great stocks, but investors should always be looking for companies that are outperforming their peers. DRDGOLD (DRD) 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.

DRDGOLD is one of 240 companies in the Basic Materials group. The Basic Materials group currently sits at #6 within 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 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. DRDGOLD is currently sporting a Zacks Rank of #2 (Buy).

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

Our latest available data shows that DRD has returned about 7.8% since the start of the calendar year. Meanwhile, the Basic Materials sector has returned an average of -0.3% on a year-to-date basis. This means that DRDGOLD is performing better than its sector in terms of year-to-date returns.

DuPont de Nemours (DD) is another Basic Materials stock that has outperformed the sector so far this year. Since the beginning of the year, the stock has returned 6.4%.

Over the past three months, DuPont de Nemours' consensus EPS estimate for the current year has increased 5.6%. The stock currently has a Zacks Rank #1 (Strong Buy).

To break things down more, DRDGOLD belongs to the Mining - Gold industry, a group that includes 39 individual companies and currently sits at #13 in the Zacks Industry Rank. On average, stocks in this group have gained 14.8% this year, meaning that DRD is slightly underperforming its industry in terms of year-to-date returns.

In contrast, DuPont de Nemours falls under the Chemical - Diversified industry. Currently, this industry has 29 stocks and is ranked #142. Since the beginning of the year, the industry has moved +0.8%.

Investors interested in the Basic Materials sector may want to keep a close eye on DRDGOLD and DuPont de Nemours as they attempt to continue their solid performance.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.