Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link. Two out of the three major indices traded up today The three major indices are trading lower today with the Dow Jones Industrial Average ( ^DJI) trading up 118 points (0.7%) at 16,519 as of Wednesday, May 7, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,991 issues advancing vs. 1,077 declining with 137 unchanged. The Consumer Non-Durables industry as a whole closed the day up 2.7% versus the S&P 500, which was up 0.6%. Top gainers within the Consumer Non-Durables industry included CCA Industries ( CAW), up 1.6%, Superior Uniform Group ( SGC), up 2.3%, EveryWare Global ( EVRY), up 339.0%, UFP Technologies ( UFPT), up 2.1% and Zep ( ZEP), up 2.1%. TheStreet Ratings Group would like to highlight 3 stocks pushing the industry higher today: Zep ( ZEP) is one of the companies that pushed the Consumer Non-Durables industry higher today. Zep was up $0.36 (2.1%) to $17.51 on heavy volume. Throughout the day, 95,832 shares of Zep exchanged hands as compared to its average daily volume of 53,400 shares. The stock ranged in a price between $16.83-$17.55 after having opened the day at $17.18 as compared to the previous trading day's close of $17.15. Zep Inc. produces and markets cleaning and maintenance chemicals, and related products and services for commercial, industrial, institutional, and consumer applications in North America and Europe. Zep has a market cap of $398.9 million and is part of the consumer goods sector. Shares are down 5.6% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates Zep a buy, no analysts rate it a sell, and 2 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 Zep as a hold. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, expanding profit margins and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, generally higher debt management risk and disappointing return on equity. Highlights from TheStreet Ratings analysis on ZEP go as follows:
- Net operating cash flow has increased to -$6.41 million or 27.99% when compared to the same quarter last year. In addition, ZEP INC has also vastly surpassed the industry average cash flow growth rate of -36.77%.
- The gross profit margin for ZEP INC is rather high; currently it is at 50.43%. Regardless of ZEP's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ZEP's net profit margin of -0.43% significantly underperformed when compared to the industry average.
- The debt-to-equity ratio of 1.19 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, ZEP maintains a poor quick ratio of 0.74, which illustrates the inability to avoid short-term cash problems.
- Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. In comparison to the other companies in the Chemicals industry and the overall market, ZEP INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
- The net income growth from the same quarter one year ago has significantly exceeded that of the Containers & Packaging industry average, but is less than that of the S&P 500. The net income increased by 5.4% when compared to the same quarter one year prior, going from $3.20 million to $3.38 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 5.8%. Since the same quarter one year prior, revenues slightly increased by 4.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- UFPT's debt-to-equity ratio is very low at 0.04 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 4.53, which clearly demonstrates the ability to cover short-term cash needs.
- Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 32.01% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, UFPT should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- UFP TECHNOLOGIES INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, UFP TECHNOLOGIES INC increased its bottom line by earning $1.59 versus $1.54 in the prior year. This year, the market expects an improvement in earnings ($1.68 versus $1.59).