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The Aerospace/Defense industry as a whole closed the day down 0.6% versus the S&P 500, which was down 0.2%. Laggards within the Aerospace/Defense industry included

Micronet Enertec Technologies

(

MICT

), down 1.8%,

Innovative Solutions and Support

(

ISSC

), down 2.3%,

Tel Instrument Electronics

(

TIK

), down 7.8%,

Rada Electronics Industries

(

RADA

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TheStreet Recommends

), down 7.5% and

LMI Aerospace

(

LMIA

), down 2.2%.

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

Sturm Ruger

(

RGR

) is one of the companies that pushed the Aerospace/Defense industry lower today. Sturm Ruger was down $1.55 (2.4%) to $62.16 on light volume. Throughout the day, 76,605 shares of Sturm Ruger exchanged hands as compared to its average daily volume of 153,900 shares. The stock ranged in price between $61.98-$63.42 after having opened the day at $63.42 as compared to the previous trading day's close of $63.71.

Sturm, Ruger & Company, Inc. designs, manufactures, and sells firearms under the Ruger trademark in the United States. Sturm Ruger has a market cap of $1.2 billion and is part of the industrial goods sector. Shares are up 84.0% year-to-date as of the close of trading on Monday. Currently there are 2 analysts who rate Sturm Ruger a buy, 1 analyst rates it a sell, and none rate it a hold.

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TheStreet Ratings rates

Sturm Ruger

as a

buy

. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins, good cash flow from operations and solid stock price performance. We feel its strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from TheStreet Ratings analysis on RGR go as follows:

  • RGR has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, RGR has a quick ratio of 1.54, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 40.74% is the gross profit margin for STURM RUGER & CO INC which we consider to be strong. It has increased from the same quarter the previous year. Along with this, the net profit margin of 12.46% is above that of the industry average.
  • Net operating cash flow has significantly increased by 142.02% to $48.08 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 115.16%.
  • STURM RUGER & CO INC's earnings per share declined by 18.8% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past two years. However, we anticipate this trend to reverse over the coming year. During the past fiscal year, STURM RUGER & CO INC reported lower earnings of $1.91 versus $5.60 in the prior year. This year, the market expects an improvement in earnings ($3.14 versus $1.91).
  • RGR, with its decline in revenue, slightly underperformed the industry average of 1.6%. Since the same quarter one year prior, revenues slightly dropped by 8.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

You can view the full analysis from the report here:

Sturm Ruger Ratings Report

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At the close,

LMI Aerospace

(

LMIA

) was down $0.26 (2.2%) to $11.44 on light volume. Throughout the day, 23,132 shares of LMI Aerospace exchanged hands as compared to its average daily volume of 63,300 shares. The stock ranged in price between $11.38-$11.75 after having opened the day at $11.64 as compared to the previous trading day's close of $11.70.

LMI Aerospace Inc. provides structural assemblies, kits and components, and design engineering services to the aerospace and defense markets in the United States. LMI Aerospace has a market cap of $158.1 million and is part of the industrial goods sector. Shares are down 17.0% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate LMI Aerospace a buy, no analysts rate it a sell, and 2 rate it a hold.

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TheStreet Ratings rates

LMI Aerospace

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, poor profit margins, weak operating cash flow, generally high debt management risk and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on LMIA go as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Aerospace & Defense industry. The net income has significantly decreased by 231.4% when compared to the same quarter one year ago, falling from -$0.44 million to -$1.47 million.
  • The gross profit margin for LMI AEROSPACE INC is rather low; currently it is at 23.91%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -1.58% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$9.28 million or 192.62% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The debt-to-equity ratio is very high at 2.38 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, LMIA's quick ratio is somewhat strong at 1.37, demonstrating the ability to handle short-term liquidity needs.
  • The share price of LMI AEROSPACE INC has not done very well: it is down 17.94% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.

You can view the full analysis from the report here:

LMI Aerospace Ratings Report

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Innovative Solutions and Support

(

ISSC

) was another company that pushed the Aerospace/Defense industry lower today. Innovative Solutions and Support was down $0.07 (2.3%) to $2.92 on average volume. Throughout the day, 12,901 shares of Innovative Solutions and Support exchanged hands as compared to its average daily volume of 11,600 shares. The stock ranged in price between $2.88-$3.04 after having opened the day at $3.00 as compared to the previous trading day's close of $2.99.

Innovative Solutions and Support, Inc. a systems integrator, designs, manufactures, sells, and services flight guidance and cockpit display systems. Innovative Solutions and Support has a market cap of $50.0 million and is part of the industrial goods sector. Shares are down 6.0% year-to-date as of the close of trading on Monday.

TheStreet Ratings rates

Innovative Solutions and Support

as a

sell

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

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Highlights from TheStreet Ratings analysis on ISSC go as follows:

  • INNOVATIVE SOLTNS & SUPP INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Earnings per share have declined over the last two years. We anticipate that this should continue in the coming year. During the past fiscal year, INNOVATIVE SOLTNS & SUPP INC reported lower earnings of $0.02 versus $0.12 in the prior year. For the next year, the market is expecting a contraction of 50.0% in earnings ($0.01 versus $0.02).
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Aerospace & Defense industry. The net income has significantly decreased by 810.7% when compared to the same quarter one year ago, falling from $0.50 million to -$3.53 million.
  • 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, INNOVATIVE SOLTNS & SUPP INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 48.66%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 800.00% compared to the year-earlier 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.
  • ISSC, with its very weak revenue results, has greatly underperformed against the industry average of 4.9%. Since the same quarter one year prior, revenues plummeted by 53.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

You can view the full analysis from the report here:

Innovative Solutions and Support Ratings Report

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