3 Stocks Pushing The Consumer Goods Sector Lower

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The Consumer Goods sector as a whole closed the day down 0.3% versus the S&P 500, which was unchanged. Laggards within the Consumer Goods sector included Virco Manufacturing ( VIRC), down 3.0%, Entertainment Gaming Asia ( EGT), down 2.1%, Golden ( GLDC), down 5.2%, Koss ( KOSS), down 4.0% and BRASILAGRO - CIA Bras de Prop Agricolas ( LND), down 2.2%.

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

Herman Miller ( MLHR) is one of the companies that pushed the Consumer Goods sector lower today. Herman Miller was down $0.64 (2.0%) to $30.74 on light volume. Throughout the day, 132,596 shares of Herman Miller exchanged hands as compared to its average daily volume of 265,700 shares. The stock ranged in price between $30.57-$31.50 after having opened the day at $31.30 as compared to the previous trading day's close of $31.38.

Herman Miller, Inc. engages in the research, design, manufacture, and distribution of office furniture systems, seating products, textiles, and related services worldwide. Herman Miller has a market cap of $1.9 billion and is part of the consumer durables industry. Shares are up 5.9% year-to-date as of the close of trading on Monday. Currently there are 2 analysts who rate Herman Miller a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Herman Miller as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, increase in stock price during the past year, expanding profit margins, growth in earnings per share and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from TheStreet Ratings analysis on MLHR go as follows:

  • MLHR's revenue growth has slightly outpaced the industry average of 3.8%. Since the same quarter one year prior, revenues slightly increased by 7.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. 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.
  • 38.08% is the gross profit margin for MILLER (HERMAN) INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 4.25% trails the industry average.
  • MILLER (HERMAN) INC has improved earnings per share by 17.9% in the most recent quarter compared to 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, MILLER (HERMAN) INC reported lower earnings of $1.16 versus $1.29 in the prior year. This year, the market expects an improvement in earnings ($1.64 versus $1.16).
  • The debt-to-equity ratio is somewhat low, currently at 0.69, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.78 is somewhat weak and could be cause for future problems.

You can view the full analysis from the report here: Herman Miller Ratings Report

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At the close, Entertainment Gaming Asia ( EGT) was down $0.01 (2.1%) to $0.63 on light volume. Throughout the day, 3,533 shares of Entertainment Gaming Asia exchanged hands as compared to its average daily volume of 20,700 shares. The stock ranged in price between $0.63-$0.69 after having opened the day at $0.63 as compared to the previous trading day's close of $0.64.

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 $21.4 million and is part of the consumer durables industry. Shares are down 42.8% year-to-date as of the close of trading on Monday.

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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 61.15%, 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 6.0%. 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 lower today. Virco Manufacturing was down $0.06 (3.0%) to $2.08 on light volume. Throughout the day, 319 shares of Virco Manufacturing exchanged hands as compared to its average daily volume of 4,500 shares. The stock ranged in price between $2.08-$2.08 after having opened the day at $2.08 as compared to the previous trading day's close of $2.14.

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 $31.5 million and is part of the consumer durables industry. Shares are down 6.7% year-to-date as of the close of trading on Monday. 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.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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. This company's share value has not moved any higher or lower since its value 12 months ago, and we feel the risks associated with investing in this company will outweigh any potential future gains.
  • 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.
  • 37.39% is the gross profit margin for VIRCO MFG. CORP which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 5.73% trails the industry average.

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.

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