3 Stocks Pushing The Materials & Construction Industry Lower

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The Materials & Construction industry as a whole closed the day down 1.7% versus the S&P 500, which was down 0.6%. Laggards within the Materials & Construction industry included Avalon Holdings ( AWX), down 4.3%, Integrated Electrical Services ( IESC), down 3.4%, Comstock ( CHCI), down 2.1%, TRC Companies ( TRR), down 8.4% and India Globalization Capital ( IGC), down 11.2%.

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

TRC Companies ( TRR) is one of the companies that pushed the Materials & Construction industry lower today. TRC Companies was down $0.49 (8.4%) to $5.37 on average volume. Throughout the day, 25,201 shares of TRC Companies exchanged hands as compared to its average daily volume of 26,000 shares. The stock ranged in price between $5.36-$5.87 after having opened the day at $5.83 as compared to the previous trading day's close of $5.86.

TRC Companies, Inc. provides engineering, consulting, and construction management services in the United States. TRC Companies has a market cap of $172.4 million and is part of the industrial goods sector. Shares are down 17.9% year-to-date as of the close of trading on Tuesday.

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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

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At the close, Comstock ( CHCI) was down $0.03 (2.1%) to $1.40 on light volume. Throughout the day, 37,325 shares of Comstock exchanged hands as compared to its average daily volume of 104,800 shares. The stock ranged in price between $1.38-$1.43 after having opened the day at $1.43 as compared to the previous trading day's close of $1.43.

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 $25.9 million and is part of the industrial goods sector. Shares are down 28.5% year-to-date as of the close of trading on Tuesday.

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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

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Integrated Electrical Services ( IESC) was another company that pushed the Materials & Construction industry lower today. Integrated Electrical Services was down $0.22 (3.4%) to $6.28 on light volume. Throughout the day, 200 shares of Integrated Electrical Services exchanged hands as compared to its average daily volume of 21,800 shares. The stock ranged in price between $6.28-$6.28 after having opened the day at $6.28 as compared to the previous trading day's close of $6.50.

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 $112.0 million and is part of the industrial goods sector. Shares are up 20.6% year-to-date as of the close of trading on Tuesday.

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.

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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 a year ago today, the stock is now trading at a higher level, regardless of the company's weak earnings results. 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 11.5%. 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

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