3 Stocks Pushing The Real Estate Industry Lower

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.

The Real Estate industry as a whole closed the day down 0.3% versus the S&P 500, which was down 0.6%. Laggards within the Real Estate industry included Alto Palermo ( APSA), down 2.7%, Institutional Financial Markets ( IFMI), down 2.8%, Amrep ( AXR), down 2.2%, Supertel Hospitality ( SPPR), down 8.8% and American Realty Investors ( ARL), down 2.6%.

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

Rouse Properties ( RSE) is one of the companies that pushed the Real Estate industry lower today. Rouse Properties was down $0.70 (4.1%) to $16.41 on light volume. Throughout the day, 212,977 shares of Rouse Properties exchanged hands as compared to its average daily volume of 321,900 shares. The stock ranged in price between $16.39-$17.18 after having opened the day at $17.18 as compared to the previous trading day's close of $17.11.

Rouse Properties, Inc. owns and manages regional malls in the United States. Its portfolio consists of 30 regional malls in 19 states totaling approximately 21 million square feet of retail and ancillary space. The company is based in New York, New York. Rouse Properties, Inc. Rouse Properties has a market cap of $998.9 million and is part of the financial sector. Shares are down 22.9% year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate Rouse Properties a buy, no analysts rate it a sell, and 3 rate it a hold.

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TheStreet Ratings rates Rouse Properties as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on RSE go as follows:

  • 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 Real Estate Investment Trusts (REITs) industry. The net income has significantly decreased by 81.7% when compared to the same quarter one year ago, falling from -$13.59 million to -$24.69 million.
  • The share price of ROUSE PROPERTIES INC has not done very well: it is down 18.15% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Real Estate Investment Trusts (REITs) industry and the overall market, ROUSE PROPERTIES INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • ROUSE PROPERTIES 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. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ROUSE PROPERTIES INC continued to lose money by earning -$0.92 versus -$1.29 in the prior year. This year, the market expects an improvement in earnings (-$0.07 versus -$0.92).
  • Net operating cash flow has significantly increased by 279.25% to $16.00 million when compared to the same quarter last year. In addition, ROUSE PROPERTIES INC has also vastly surpassed the industry average cash flow growth rate of 8.68%.

You can view the full analysis from the report here: Rouse Properties Ratings Report

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At the close, Supertel Hospitality ( SPPR) was down $0.13 (8.8%) to $1.35 on heavy volume. Throughout the day, 69,254 shares of Supertel Hospitality exchanged hands as compared to its average daily volume of 42,100 shares. The stock ranged in price between $1.35-$1.57 after having opened the day at $1.57 as compared to the previous trading day's close of $1.48.

Supertel Hospitality, Inc. is an independent equity real estate investment trust. The firm invests in the real estate markets of the United States. It primarily invests in limited-service hotels. The firm was formerly known as Humphrey Hospitality Trust, Inc. Supertel Hospitality, Inc. Supertel Hospitality has a market cap of $4.4 million and is part of the financial sector. Shares are down 39.3% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates Supertel Hospitality as a sell. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on SPPR go as follows:

  • SPPR'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 81.90%, 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 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 Real Estate Investment Trusts (REITs) industry and the overall market, SUPERTEL HOSPITALITY INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • SPPR, with its decline in revenue, underperformed when compared the industry average of 9.8%. Since the same quarter one year prior, revenues slightly dropped by 6.4%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • Net operating cash flow has increased to -$1.24 million or 49.15% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 8.68%.
  • SUPERTEL HOSPITALITY INC reported significant earnings per share improvement 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 two years. During the past fiscal year, SUPERTEL HOSPITALITY INC continued to lose money by earning -$1.38 versus -$4.96 in the prior year.

You can view the full analysis from the report here: Supertel Hospitality Ratings Report

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Amrep ( AXR) was another company that pushed the Real Estate industry lower today. Amrep was down $0.11 (2.2%) to $4.97 on average volume. Throughout the day, 15,704 shares of Amrep exchanged hands as compared to its average daily volume of 12,100 shares. The stock ranged in price between $4.95-$5.24 after having opened the day at $5.15 as compared to the previous trading day's close of $5.08.

AMREP Corporation, through its subsidiaries, engages in media services and real estate businesses. It operates in four segments: Subscription Fulfillment Services; Newsstand Distribution Services; Product Packaging and Fulfillment Services, and Other; and Real Estate Operations. Amrep has a market cap of $37.5 million and is part of the financial sector. Shares are down 27.4% year-to-date as of the close of trading on Tuesday.

TheStreet Ratings rates Amrep as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, poor profit margins, weak operating cash flow and feeble growth in its earnings per share.

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Highlights from TheStreet Ratings analysis on AXR go as follows:

  • 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 466.7% when compared to the same quarter one year ago, falling from $0.00 million to -$0.01 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Commercial Services & Supplies industry and the overall market, AMREP CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for AMREP CORP is rather low; currently it is at 16.32%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -0.04% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$1.61 million or 142.56% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • AMREP CORP has shown no change in earnings for its most recently reported quarter when compared with the same quarter a year earlier. The company has suffered a declining pattern earnings per share over the past two years. During the past fiscal year, AMREP CORP reported poor results of -$0.47 versus -$0.19 in the prior year.

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

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