3 Stocks Boosting The Industrial Goods Sector Higher

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 Industrial Goods sector as a whole was unchanged today versus the S&P 500, which was up 0.6%. Top gainers within the Industrial Goods sector included Continental Materials ( CUO), up 1.9%, American DG Energy ( ADGE), up 2.8%, Integrated Electrical Services ( IESC), up 3.9%, TRC Companies ( TRR), up 2.5% and Sharps Compliance ( SMED), up 2.6%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the sector higher today:

Sharps Compliance ( SMED) is one of the companies that pushed the Industrial Goods sector higher today. Sharps Compliance was up $0.10 (2.6%) to $4.01 on light volume. Throughout the day, 25,857 shares of Sharps Compliance exchanged hands as compared to its average daily volume of 39,100 shares. The stock ranged in a price between $3.95-$4.12 after having opened the day at $4.00 as compared to the previous trading day's close of $3.91.

Sharps Compliance Corp. provides management solutions for medical waste, used healthcare materials, and unused dispensed medications in the United States. Sharps Compliance has a market cap of $60.2 million and is part of the consumer durables industry. Shares are down 17.3% year-to-date as of the close of trading on Tuesday. Currently there are 2 analysts who rate Sharps Compliance a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Sharps Compliance as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.

Highlights from TheStreet Ratings analysis on SMED go as follows:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 10.6%. Since the same quarter one year prior, revenues slightly increased by 2.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • SMED 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. Along with this, the company maintains a quick ratio of 4.54, which clearly demonstrates the ability to cover short-term cash needs.
  • The net income growth from the same quarter one year ago has exceeded that of the Health Care Providers & Services industry average, but is less than that of the S&P 500. The net income increased by 2.1% when compared to the same quarter one year prior, going from -$0.96 million to -$0.94 million.
  • 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 Health Care Providers & Services industry and the overall market, SHARPS COMPLIANCE CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for SHARPS COMPLIANCE CORP is currently lower than what is desirable, coming in at 28.26%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -16.84% is significantly below that of the industry average.

You can view the full analysis from the report here: Sharps Compliance 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, TRC Companies ( TRR) was up $0.13 (2.5%) to $5.31 on average volume. Throughout the day, 32,317 shares of TRC Companies exchanged hands as compared to its average daily volume of 24,900 shares. The stock ranged in a price between $5.17-$5.42 after having opened the day at $5.22 as compared to the previous trading day's close of $5.18.

TRC Companies, Inc. provides engineering, consulting, and construction management services in the United States. TRC Companies has a market cap of $162.7 million and is part of the consumer durables industry. Shares are down 27.4% year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate TRC Companies a buy, no analysts rate it a sell, and none 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 TRC Companies as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, reasonable valuation levels and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from TheStreet Ratings analysis on TRR go as follows:

  • The revenue growth came in higher than the industry average of 4.6%. Since the same quarter one year prior, revenues rose by 17.3%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • TRR's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.39, which illustrates the ability to avoid short-term cash problems.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Commercial Services & Supplies industry and the overall market, TRC COS INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.

You can view the full analysis from the report here: TRC Companies 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.

Integrated Electrical Services ( IESC) was another company that pushed the Industrial Goods sector higher today. Integrated Electrical Services was up $0.23 (3.9%) to $6.08 on light volume. Throughout the day, 14,818 shares of Integrated Electrical Services exchanged hands as compared to its average daily volume of 21,700 shares. The stock ranged in a price between $5.95-$6.39 after having opened the day at $6.39 as compared to the previous trading day's close of $5.85.

Integrated Electrical Services, Inc., through its subsidiaries, provides communications, residential, commercial and industrial, and infrastructure solutions in the United States. Integrated Electrical Services has a market cap of $108.8 million and is part of the consumer durables industry. Shares are up 8.5% year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate Integrated Electrical Services a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Integrated Electrical Services as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, increase in stock price during the past year and notable return on equity. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, weak operating cash flow and poor profit margins.

Highlights from TheStreet Ratings analysis on IESC go as follows:

  • IESC's debt-to-equity ratio is very low at 0.21 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.18, which illustrates the ability to avoid short-term cash problems.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 11.3%. Since the same quarter one year prior, revenues slightly dropped by 5.6%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • Net operating cash flow has significantly decreased to -$2.20 million or 166.79% 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 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 Construction & Engineering industry. The net income has significantly decreased by 75.7% when compared to the same quarter one year ago, falling from $0.51 million to $0.12 million.

You can view the full analysis from the report here: Integrated Electrical Services 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.

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.

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