3 Stocks Pushing The Consumer Durables Industry Lower

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The Consumer Durables industry as a whole closed the day down 0.9% versus the S&P 500, which was down 0.9%. Laggards within the Consumer Durables industry included Cobra Electronics ( COBR), down 2.4%, Emerson Radio ( MSN), down 1.7%, Natuzzi SPA ( NTZ), down 2.7%, Escalade ( ESCA), down 2.0% and Bassett Furniture Industries ( BSET), down 1.7%.

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

Bassett Furniture Industries ( BSET) is one of the companies that pushed the Consumer Durables industry lower today. Bassett Furniture Industries was down $0.22 (1.7%) to $13.00 on light volume. Throughout the day, 24,985 shares of Bassett Furniture Industries exchanged hands as compared to its average daily volume of 37,000 shares. The stock ranged in price between $13.00-$13.27 after having opened the day at $13.25 as compared to the previous trading day's close of $13.22.

Bassett Furniture Industries, Incorporated manufactures, imports, and retails home furnishings in the United States. The company operates in three segments: Wholesale, Retail, and Investments and Real Estate. Bassett Furniture Industries has a market cap of $148.7 million and is part of the consumer goods sector. Shares are down 13.5% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Bassett Furniture Industries as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from TheStreet Ratings analysis on BSET go as follows:

  • BSET's debt-to-equity ratio is very low at 0.02 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 1.06, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has significantly increased by 171.23% to $5.34 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 151.78%.
  • The gross profit margin for BASSETT FURNITURE INDS is rather high; currently it is at 55.45%. 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 1.11% trails the industry average.
  • BASSETT FURNITURE INDS's earnings per share declined by 11.1% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, BASSETT FURNITURE INDS reported lower earnings of $0.47 versus $2.42 in the prior year. This year, the market expects an improvement in earnings ($0.53 versus $0.47).
  • BSET, with its decline in revenue, underperformed when compared the industry average of 17.3%. Since the same quarter one year prior, revenues slightly dropped by 5.3%. 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: Bassett Furniture Industries Ratings Report

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At the close, Natuzzi SPA ( NTZ) was down $0.07 (2.7%) to $2.50 on light volume. Throughout the day, 1,900 shares of Natuzzi SPA exchanged hands as compared to its average daily volume of 33,400 shares. The stock ranged in price between $2.49-$2.52 after having opened the day at $2.52 as compared to the previous trading day's close of $2.57.

Natuzzi S.p.A. designs, manufactures, and markets leather and fabric upholstered furniture worldwide. Natuzzi SPA has a market cap of $139.3 million and is part of the consumer goods sector. Shares are down 0.8% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Natuzzi SPA 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 NTZ go as follows:

  • NATUZZI SPA 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, NATUZZI SPA reported poor results of -$1.71 versus -$0.63 in the prior year.
  • 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 significantly decreased by 75.6% when compared to the same quarter one year ago, falling from -$7.69 million to -$13.50 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 Household Durables industry and the overall market, NATUZZI SPA's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for NATUZZI SPA is currently lower than what is desirable, coming in at 31.00%. Regardless of NTZ's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, NTZ's net profit margin of -9.95% significantly underperformed when compared to the industry average.
  • NTZ, with its decline in revenue, underperformed when compared the industry average of 17.3%. Since the same quarter one year prior, revenues slightly dropped by 4.4%. 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: Natuzzi SPA Ratings Report

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Cobra Electronics ( COBR) was another company that pushed the Consumer Durables industry lower today. Cobra Electronics was down $0.08 (2.4%) to $3.20 on light volume. Throughout the day, 826 shares of Cobra Electronics exchanged hands as compared to its average daily volume of 9,000 shares. The stock ranged in price between $3.20-$3.24 after having opened the day at $3.24 as compared to the previous trading day's close of $3.28.

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 consumer goods sector. Shares are up 8.6% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates Cobra Electronics as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, poor profit margins and feeble growth in its earnings per share.

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Highlights from TheStreet Ratings analysis on COBR go as follows:

  • 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 30.85%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -7.79% trails 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).
  • The change in net income from the same quarter one year ago has significantly exceeded that of the Household Durables industry average, but is less than that of the S&P 500. 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.
  • In its most recent trading session, COBR 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. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.

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.

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