3 Stocks Pushing The Real Estate Industry Downward

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

All three major indices are trading up today with the Dow Jones Industrial Average ( ^DJI) trading up 115 points (0.8%) at 14,816 as of Thursday, May 2, 2013, 12:55 PM ET. The NYSE advances/declines ratio sits at 2,190 issues advancing vs. 733 declining with 109 unchanged.

The Real Estate industry currently sits up 0.8% versus the S&P 500, which is up 0.8%. On the negative front, top decliners within the industry include Annaly Capital Management ( NLY), down 2.15, Icahn ( IEP), down 1.51, Digital Realty ( DLR), down 1.01, Equity Residential ( EQR), down 0.65 and AvalonBay Communities ( AVB), down 0.58. Top gainers within the industry include Newcastle Investment Corporation ( NCT), up 5.2%, Omega Healthcare Investors ( OHI), up 3.6%, Kimco Realty ( KIM), up 2.1%, National Retail Properties ( NNN), up 1.8% and Starwood Property ( STWD), up 1.7%.

TheStreet Ratings group would like to highlight 3 stocks pushing the industry lower today:

3. Invesco Mortgage Capital ( IVR) is one of the companies pushing the Real Estate industry lower today. As of noon trading, Invesco Mortgage Capital is down $0.36 (-1.7%) to $20.77 on average volume Thus far, 1.3 million shares of Invesco Mortgage Capital exchanged hands as compared to its average daily volume of 1.8 million shares. The stock has ranged in price between $20.52-$21.15 after having opened the day at $21.14 as compared to the previous trading day's close of $21.13.

Invesco Mortgage Capital Inc., a real estate investment trust (REIT), focuses on investing in, financing, and managing residential and commercial mortgage-backed securities and mortgage loans. It invests in residential mortgage-backed securities for which a U.S. Invesco Mortgage Capital has a market cap of $2.9 billion and is part of the financial sector. The company has a P/E ratio of 7.4, below the S&P 500 P/E ratio of 17.7. Shares are up 7.2% year to date as of the close of trading on Wednesday.

TheStreet Ratings rates Invesco Mortgage Capital as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, compelling growth in net income and revenue growth. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and feeble growth in the company's earnings per share. Get the full Invesco Mortgage Capital Ratings Report now.

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2. As of noon trading, Essex Property ( ESS) is down $4.05 (-2.6%) to $151.95 on heavy volume Thus far, 244,576 shares of Essex Property exchanged hands as compared to its average daily volume of 272,900 shares. The stock has ranged in price between $151.90-$155.87 after having opened the day at $152.50 as compared to the previous trading day's close of $156.00.

Essex Property Trust, Inc. operates as a self-administered and self-managed real estate investment trust in the United States. It engages in the ownership, operation, management, acquisition, development, and redevelopment of apartment communities, as well as commercial properties. Essex Property has a market cap of $6.0 billion and is part of the financial sector. The company has a P/E ratio of 50.0, above the S&P 500 P/E ratio of 17.7. Shares are up 6.4% year to date as of the close of trading on Wednesday.

TheStreet Ratings rates Essex Property as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, compelling growth in net income, expanding profit margins, good cash flow from operations and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself. Get the full Essex Property Ratings Report now.

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1. As of noon trading, CommonWealth REIT ( CWH) is down $0.52 (-2.3%) to $21.77 on light volume Thus far, 1.3 million shares of CommonWealth REIT exchanged hands as compared to its average daily volume of 4.1 million shares. The stock has ranged in price between $21.67-$22.36 after having opened the day at $22.25 as compared to the previous trading day's close of $22.29.

CommonWealth REIT is a real estate investment trust launched and managed by Reit Management & Research LLC. The fund invests in the real estate markets of the United States. It seeks to invest in office buildings, industrial buildings, and leased industrial land. CommonWealth REIT has a market cap of $2.6 billion and is part of the financial sector. The company has a P/E ratio of 63.8, above the S&P 500 P/E ratio of 17.7. Shares are up 40.7% year to date as of the close of trading on Wednesday.

TheStreet Ratings rates CommonWealth REIT as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and reasonable valuation levels. However, as a counter to these strengths, we also find weaknesses including deteriorating net income and poor profit margins. Get the full CommonWealth REIT Ratings Report now.

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If you are interested in one of these 5 stocks, ETFs may be of interest. Investors who are bullish on the real estate industry could consider iShares Dow Jones US Real Estate ( IYR) while those bearish on the real estate industry could consider ProShares Short Real Estate Fund ( REK).

A reminder about TheStreet Ratings group: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.
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