3 Materials & Construction Stocks Pushing The Industry 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.

All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 112 points (0.7%) at 16,695 as of Monday, May 12, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 2,429 issues advancing vs. 632 declining with 133 unchanged.

The Materials & Construction industry as a whole closed the day up 2.0% versus the S&P 500, which was up 1.0%. Top gainers within the Materials & Construction industry included Industrial Services of America ( IDSA), up 2.3%, Jewett-Cameron Trading ( JCTCF), up 1.6%, Comstock ( CHCI), up 11.0%, TRC Companies ( TRR), up 3.2% and Guanwei Recycling ( GPRC), up 7.4%.

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

TRC Companies ( TRR) is one of the companies that pushed the Materials & Construction industry higher today. TRC Companies was up $0.18 (3.2%) to $5.80 on average volume. Throughout the day, 25,820 shares of TRC Companies exchanged hands as compared to its average daily volume of 25,900 shares. The stock ranged in a price between $5.59-$5.85 after having opened the day at $5.69 as compared to the previous trading day's close of $5.62.

TRC Companies, Inc. provides engineering, consulting, and construction management services in the United States. TRC Companies has a market cap of $157.5 million and is part of the industrial goods sector. Shares are down 21.3% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate TRC Companies a buy, no analysts rate it a sell, and none rate it a hold.

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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 and reasonable valuation levels. 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 3.8%. 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.
  • TRC COS INC's earnings per share declined by 28.6% 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, TRC COS INC increased its bottom line by earning $1.22 versus $1.18 in the prior year. For the next year, the market is expecting a contraction of 64.8% in earnings ($0.43 versus $1.22).

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.

At the close, Comstock ( CHCI) was up $0.14 (11.0%) to $1.41 on average volume. Throughout the day, 92,068 shares of Comstock exchanged hands as compared to its average daily volume of 107,600 shares. The stock ranged in a price between $1.25-$1.44 after having opened the day at $1.27 as compared to the previous trading day's close of $1.27.

Comstock Holding Companies, Inc. operates as a real estate development and construction services company in the United States. The company operates through three segments: Homebuilding, Multi-family, and Real Estate Services. Comstock has a market cap of $23.9 million and is part of the industrial goods sector. Shares are down 36.5% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate Comstock 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 Comstock as a sell. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, generally disappointing historical performance in the stock itself and poor profit margins.

Highlights from TheStreet Ratings analysis on CHCI go as follows:

  • The debt-to-equity ratio is very high at 7.20 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
  • CHCI'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 46.29%, 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 gross profit margin for COMSTOCK HOLDING COS INC is rather low; currently it is at 22.19%. Regardless of CHCI's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -5.52% trails the industry average.
  • 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 Household Durables industry and the overall market, COMSTOCK HOLDING COS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • COMSTOCK HOLDING COS INC has improved earnings per share by 45.5% 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 year. During the past fiscal year, COMSTOCK HOLDING COS INC continued to lose money by earning -$0.10 versus -$0.47 in the prior year.

You can view the full analysis from the report here: Comstock 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.

Industrial Services of America ( IDSA) was another company that pushed the Materials & Construction industry higher today. Industrial Services of America was up $0.11 (2.3%) to $4.92 on light volume. Throughout the day, 6,522 shares of Industrial Services of America exchanged hands as compared to its average daily volume of 14,500 shares. The stock ranged in a price between $4.85-$4.98 after having opened the day at $4.94 as compared to the previous trading day's close of $4.81.

Industrial Services of America, Inc. operates as a recycler of stainless steel, ferrous, and non-ferrous scrap. The company operates in two segments, Recycling and Waste Services. Industrial Services of America has a market cap of $34.5 million and is part of the industrial goods sector. Shares are up 51.8% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate Industrial Services of America a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Industrial Services of America 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 poor profit margins.

Highlights from TheStreet Ratings analysis on IDSA go as follows:

  • INDUSTRIAL SERVICES AMER 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. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, INDUSTRIAL SERVICES AMER INC reported poor results of -$1.96 versus -$0.96 in the prior year.
  • 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 Commercial Services & Supplies industry. The net income has significantly decreased by 128.1% when compared to the same quarter one year ago, falling from -$4.50 million to -$10.27 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 Commercial Services & Supplies industry and the overall market, INDUSTRIAL SERVICES AMER INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for INDUSTRIAL SERVICES AMER INC is currently extremely low, coming in at 0.11%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -35.96% is significantly below that of the industry average.
  • IDSA, with its decline in revenue, underperformed when compared the industry average of 3.8%. Since the same quarter one year prior, revenues fell by 22.8%. 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: Industrial Services of America 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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