3 Consumer Goods Stocks Moving The Sector Upward

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 8 points (0.1%) at 16,707 as of Friday, May 30, 2014, 3:55 PM ET. The NYSE advances/declines ratio sits at 1,211 issues advancing vs. 1,772 declining with 147 unchanged.

The Consumer Goods sector as a whole closed the day down 0.1% versus the S&P 500, which was up 0.1%. Top gainers within the Consumer Goods sector included Virco Manufacturing ( VIRC), up 3.9%, Entertainment Gaming Asia ( EGT), up 4.4%, Cobra Electronics ( COBR), up 1.5%, Constellation Brands ( STZ.B), up 1.5% and Kewaunee Scientific ( KEQU), up 2.4%.

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

Cobra Electronics ( COBR) is one of the companies that pushed the Consumer Goods sector higher today. Cobra Electronics was up $0.05 (1.5%) to $3.28 on light volume. Throughout the day, 1,780 shares of Cobra Electronics exchanged hands as compared to its average daily volume of 10,000 shares. The stock ranged in a price between $3.19-$3.28 after having opened the day at $3.19 as compared to the previous trading day's close of $3.23.

Cobra Electronics Corporation designs and markets consumer electronics products in the United States, Canada, and Europe. Cobra Electronics has a market cap of $21.6 million and is part of the food & beverage industry. Shares are up 7.0% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Cobra Electronics 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 Cobra Electronics 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 and feeble growth in its earnings per share.

Highlights from TheStreet Ratings analysis on COBR go as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Household Durables industry. The net income has decreased by 8.7% when compared to the same quarter one year ago, dropping from -$1.53 million to -$1.67 million.
  • 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. Compared to other companies in the Household Durables industry and the overall market, COBRA ELECTRONICS CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for COBRA ELECTRONICS CORP is currently lower than what is desirable, coming in at 27.03%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -7.79% is significantly below that of the industry average.
  • COBRA ELECTRONICS CORP's earnings per share declined by 8.7% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, COBRA ELECTRONICS CORP swung to a loss, reporting -$0.17 versus $0.49 in the prior year. This year, the market expects an improvement in earnings (-$0.06 versus -$0.17).
  • COBR, with its decline in revenue, underperformed when compared the industry average of 18.8%. Since the same quarter one year prior, revenues slightly dropped by 0.9%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

You can view the full analysis from the report here: Cobra Electronics 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, Entertainment Gaming Asia ( EGT) was up $0.03 (4.4%) to $0.71 on light volume. Throughout the day, 4,480 shares of Entertainment Gaming Asia exchanged hands as compared to its average daily volume of 20,900 shares. The stock ranged in a price between $0.68-$0.71 after having opened the day at $0.68 as compared to the previous trading day's close of $0.68.

Entertainment Gaming Asia Inc. engages in the ownership and leasing of electronic gaming machines (EGMs) in resorts, hotels, and other venues primarily in Cambodia and the Philippines. Entertainment Gaming Asia has a market cap of $21.1 million and is part of the food & beverage industry. Shares are down 45.2% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Entertainment Gaming Asia 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 Entertainment Gaming Asia as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on EGT go as follows:

  • ENTERTAINMENT GAMING ASIA 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, ENTERTAINMENT GAMING ASIA swung to a loss, reporting -$0.17 versus $0.07 in the prior year.
  • 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 Hotels, Restaurants & Leisure industry and the overall market, ENTERTAINMENT GAMING ASIA's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for ENTERTAINMENT GAMING ASIA is currently extremely low, coming in at 13.85%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -20.97% is significantly below that of the industry average.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 59.07%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 200.00% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • EGT, with its decline in revenue, underperformed when compared the industry average of 6.1%. Since the same quarter one year prior, revenues fell by 29.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

You can view the full analysis from the report here: Entertainment Gaming Asia 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.

Virco Manufacturing ( VIRC) was another company that pushed the Consumer Goods sector higher today. Virco Manufacturing was up $0.08 (3.9%) to $2.14 on average volume. Throughout the day, 5,000 shares of Virco Manufacturing exchanged hands as compared to its average daily volume of 4,600 shares. The stock ranged in a price between $2.06-$2.14 after having opened the day at $2.07 as compared to the previous trading day's close of $2.06.

Virco Mfg. Corporation is engaged in the design, production, and distribution of furniture for the commercial and education markets in the United States. Virco Manufacturing has a market cap of $29.9 million and is part of the food & beverage industry. Shares are down 10.2% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Virco Manufacturing a buy, no analysts rate it a sell, and 1 rates it a hold.

TheStreet Ratings rates Virco Manufacturing as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on VIRC go as follows:

  • 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, VIRCO MFG. CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • In its most recent trading session, VIRC has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. 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 company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and the Commercial Services & Supplies industry average. The net income increased by 17.2% when compared to the same quarter one year prior, going from $2.91 million to $3.41 million.
  • VIRC's debt-to-equity ratio is very low at 0.11 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.72 is somewhat weak and could be cause for future problems.
  • Net operating cash flow has slightly increased to $24.63 million or 4.47% when compared to the same quarter last year. Despite an increase in cash flow, VIRCO MFG. CORP's average is still marginally south of the industry average growth rate of 4.88%.

You can view the full analysis from the report here: Virco Manufacturing 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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