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The Aerospace/Defense industry as a whole closed the day down 0.8% versus the S&P 500, which was down 1.3%. Laggards within the Aerospace/Defense industry included

Micronet Enertec Technologies

(

MICT

), down 4.6%,

Moog

(

MOG.B

), down 2.0%,

Acorn Energy

(

ACFN

), down 3.1%,

Erickson

(

EAC

), down 1.8% and

CAE

(

CAE

), down 1.9%.

TheStreet Ratings Group would like to highlight 3 stocks that pushed the industry lower today:

CAE

(

CAE

) is one of the companies that pushed the Aerospace/Defense industry lower today. CAE was down $0.25 (1.9%) to $12.59 on heavy volume. Throughout the day, 73,560 shares of CAE exchanged hands as compared to its average daily volume of 39,900 shares. The stock ranged in price between $12.52-$12.87 after having opened the day at $12.87 as compared to the previous trading day's close of $12.84.

CAE Inc. provides simulation and modeling technologies, and integrated training services primarily to the civil aviation industry and defense forces worldwide. CAE has a market cap of $3.4 billion and is part of the industrial goods sector. Shares are down 1.3% year-to-date as of the close of trading on Tuesday. Currently there are 5 analysts who rate CAE a buy, no analysts rate it a sell, and 2 rate it a hold.

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TheStreet Ratings rates

CAE

as a

buy

. The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from TheStreet Ratings analysis on CAE go as follows:

  • The revenue growth came in higher than the industry average of 0.5%. Since the same quarter one year prior, revenues rose by 10.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • CAE INC has improved earnings per share by 6.7% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. During the past fiscal year, CAE INC increased its bottom line by earning $0.73 versus $0.53 in the prior year.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Aerospace & Defense industry average. The net income increased by 12.0% when compared to the same quarter one year prior, going from $38.30 million to $42.90 million.
  • CAE's debt-to-equity ratio of 0.87 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.81 is weak.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to the other companies in the Aerospace & Defense industry and the overall market, CAE INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.

TheStreet Recommends

You can view the full analysis from the report here:

CAE Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

At the close,

Erickson

(

EAC

) was down $0.13 (1.8%) to $7.22 on average volume. Throughout the day, 29,921 shares of Erickson exchanged hands as compared to its average daily volume of 26,400 shares. The stock ranged in price between $7.20-$7.53 after having opened the day at $7.41 as compared to the previous trading day's close of $7.35.

Erickson Incorporated provides aviation services to commercial and government customers. As of December 31, 2013, the company operated a fleet of 90 rotary-wing and fixed wing aircrafts, including a fleet of 20 heavy-lift Erickson S-64 aircranes. Erickson has a market cap of $101.7 million and is part of the industrial goods sector. Shares are down 11.8% year-to-date as of the close of trading on Tuesday. Currently there are 2 analysts who rate Erickson a buy, 1 analyst rates it a sell, and 3 rate it a hold.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreet Ratings rates

Erickson

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, generally high debt management risk, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from TheStreet Ratings analysis on EAC go as follows:

  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Aerospace & Defense industry and the overall market, ERICKSON INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • EAC's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 67.71%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • The debt-to-equity ratio is very high at 2.49 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, EAC's quick ratio is somewhat strong at 1.09, demonstrating the ability to handle short-term liquidity needs.
  • ERICKSON INC has improved earnings per share by 16.2% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, ERICKSON INC reported lower earnings of $0.60 versus $1.56 in the prior year. For the next year, the market is expecting a contraction of 25.0% in earnings ($0.45 versus $0.60).
  • EAC, with its decline in revenue, slightly underperformed the industry average of 1.9%. Since the same quarter one year prior, revenues slightly dropped by 1.6%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

You can view the full analysis from the report here:

Erickson Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Acorn Energy

(

ACFN

) was another company that pushed the Aerospace/Defense industry lower today. Acorn Energy was down $0.02 (3.1%) to $0.49 on light volume. Throughout the day, 82,390 shares of Acorn Energy exchanged hands as compared to its average daily volume of 271,300 shares. The stock ranged in price between $0.48-$0.54 after having opened the day at $0.53 as compared to the previous trading day's close of $0.51.

Acorn Energy, Inc., through its subsidiaries, provides technology driven solutions for energy infrastructure asset management worldwide. It offers oil and gas sensor systems, a fiber optic sensing system for the energy, commercial security, and defense markets. Acorn Energy has a market cap of $12.7 million and is part of the industrial goods sector. Shares are down 37.7% year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate Acorn Energy a buy, no analysts rate it a sell, and 1 rates it a hold.

TheStreet Ratings rates

Acorn Energy

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its poor profit margins and generally disappointing historical performance in the stock itself.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Highlights from TheStreet Ratings analysis on ACFN go as follows:

  • The gross profit margin for ACORN ENERGY INC is currently lower than what is desirable, coming in at 32.75%. Regardless of ACFN's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, ACFN's net profit margin of -68.25% significantly underperformed when compared to the industry average.
  • ACFN's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 87.66%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, ACORN ENERGY INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • ACFN's debt-to-equity ratio is very low at 0.26 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 1.00 is somewhat weak and could be cause for future problems.
  • Net operating cash flow has slightly increased to -$5.30 million or 3.62% when compared to the same quarter last year. Despite an increase in cash flow, ACORN ENERGY INC's cash flow growth rate is still lower than the industry average growth rate of 31.41%.

You can view the full analysis from the report here:

Acorn Energy Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.