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Nothing Basic About This Quarter for Basic Materials

How the pandemic has and will affect these companies.

The Morningstar US Basic Materials Index’s underperformance versus the broader market has increased in 2020. Year to date, the sector has now lagged the Morningstar US Market Index by more than 700 basis points, driving trailing one-year underperformance to nearly 900 basis points.

As a result, more than 70% of the U.S. basic materials stocks we cover now trade in 4- and 5-star territory, with the median stock trading at a 31% discount to our fair value estimate.