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Validea's Top Five Basic Materials Stocks Based On Joel Greenblatt - 8/23/2020

The following are the top rated Basic Materials stocks according to Validea's Earnings Yield Investor model based on the published strategy of Joel Greenblatt. This value model looks for companies with high return on capital and earnings yields.

CALEDONIA MINING CORPORATION PLC (USA) (CMCL) is a small-cap value stock in the Gold & Silver industry. The rating according to our strategy based on Joel Greenblatt is 90% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Caledonia Mining Corporation Plc is primarily involved in the operation of a gold mine, and the exploration and development of mineral properties for precious metals. The Company's activities are focused on the Blanket Mine in Zimbabwe. Its segments include Corporate, Zimbabwe, South Africa and Zambia. The Corporate segment includes the Company and Greenstone Management Services Limited (UK) responsible for administrative functions. The Zimbabwe segments include Caledonia Holdings Zimbabwe Limited and subsidiaries. The Zambia segments consist of Nama copper project and cobalt project. The South Africa segment comprises a gold mine, as well as sales made by Caledonia Mining South Africa Proprietary Limited to the Blanket Mine. The Blanket Mine is located approximately 560 kilometers south of Harare and over 150 kilometers south of Bulawayo. It has exploration title holdings in the Gwanda Greenstone Belt totaling approximately 80 claims, covering a total area of over 2,500 hectares.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS YIELD:NEUTRAL
RETURN ON TANGIBLE CAPITAL:NEUTRAL
FINAL RANKING:PASS

Detailed Analysis of CALEDONIA MINING CORPORATION PLC (USA)

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CRANE CO. (CR) is a mid-cap growth stock in the Misc. Fabricated Products industry. The rating according to our strategy based on Joel Greenblatt is 90% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Crane Co. (Crane) is a manufacturer of engineered industrial products. The Company operates through four segments, including Fluid Handling, Payment & Merchandising Technologies, Aerospace & Electronics, and Engineered Materials. The Fluid Handling segment is a provider of engineered fluid handling equipment, including Process Valves and Related Products, Commercial Valves and Other Products. The Payment & Merchandising Technologies segment includes Crane Payment Innovations (CPI) and Merchandising Systems. The Aerospace & Electronics segment supplies various components and systems, including original equipment and aftermarket parts, primarily for the commercial aerospace and military aerospace, and defense markets. The Engineered Materials segment manufactures fiberglass-reinforced plastic (FRP) panels and coils, primarily for use in the manufacturing of recreational vehicles (RVs), truck bodies, truck trailers, with additional applications in commercial and industrial buildings.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS YIELD:NEUTRAL
RETURN ON TANGIBLE CAPITAL:NEUTRAL
FINAL RANKING:PASS

Detailed Analysis of CRANE CO.

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PENTAIR PLC (PNR) is a mid-cap growth stock in the Misc. Fabricated Products industry. The rating according to our strategy based on Joel Greenblatt is 60% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Pentair plc is a diversified industrial manufacturing company. The Company is engaged in Water Quality Systems business and Flow and Filtration Solutions business. The Water Quality Systems business designs, manufactures, markets and services water system products and solutions to meet filtration and fluid management challenges in food and beverage, water, swimming pools and aquaculture applications. The Flow and Filtration Solutions business is involved in the entire water, water treatment and wastewater system from filtration, desalination, water supply to water disposal, process and control.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS YIELD:NEUTRAL
RETURN ON TANGIBLE CAPITAL:NEUTRAL
FINAL RANKING:FAIL

Detailed Analysis of PENTAIR PLC

Full Guru Analysis for PNR>

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REXNORD CORP (RXN) is a mid-cap growth stock in the Misc. Fabricated Products industry. The rating according to our strategy based on Joel Greenblatt is 60% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Rexnord Corporation is a multi-platform industrial company. The Company operates through two segments: Process & Motion Control platform, and Water Management platform. The Process & Motion Control platform designs, manufactures, markets and services a range of engineered mechanical components used within systems. The Process & Motion Control portfolio includes motion control products, shaft management products, aerospace components and related value-added services. Its Process & Motion Control brands include Rexnord, Rex, Euroflex, Falk, FlatTop, Link-Belt, Thomas and Tollok. The Water Management platform designs, procures and markets products that provide and enhance water quality, safety, flow control and conservation. The Water Management product portfolio includes professional grade water control and safety, water distribution and drainage, finish plumbing and site works products. Its products are marketed and sold under various brand names, including Zurn, Wilkins and VAG.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS YIELD:NEUTRAL
RETURN ON TANGIBLE CAPITAL:NEUTRAL
FINAL RANKING:FAIL

Detailed Analysis of REXNORD CORP

Full Guru Analysis for RXN>

Full Factor Report for RXN>

SEALED AIR CORP (SEE) is a mid-cap growth stock in the Containers & Packaging industry. The rating according to our strategy based on Joel Greenblatt is 60% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.

Company Description: Sealed Air Corporation is engaged in food safety and security, facility hygiene and product protection business. The Company's segments are Food Care (includes Corporate, Medical Applications and New Ventures businesses), Product Care and Corporate. The Food Care segment focuses on providing a range of integrated system solutions. The Food Care business serves primarily perishable food and beverage processors, predominately in fresh red meat, smoked and processed meats, beverages, poultry and dairy (solids and liquids) markets throughout the world. The Product Care segment provides customers with a range of Product Care solutions to meet cushioning, void fill, surface protection, retail display, containment and dunnage needs.

The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.

EARNINGS YIELD:NEUTRAL
RETURN ON TANGIBLE CAPITAL:NEUTRAL
FINAL RANKING:FAIL

Detailed Analysis of SEALED AIR CORP

Full Guru Analysis for SEE>

Full Factor Report for SEE>

More details on Validea's Joel Greenblatt strategy

Joel Greenblatt Stock Ideas

About Joel Greenblatt: In his 2005 bestseller The Little Book That Beats The Market, hedge fund manager Joel Greenblatt laid out a stunningly simple way to beat the market using two -- and only two -- fundamental variables. The "Magic Formula," as he called it, produced back-tested returns of 30.8 percent per year from 1988 through 2004, more than doubling the S&P 500's 12.4 percent return during that time. Greenblatt also produced exceptional returns as managing partner at Gotham Capital, a New York City-based hedge fund he founded. The firm averaged a remarkable 40 percent annualized return over more than two decades.

About Validea: Validea is an investment research service that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here

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

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