3 Stocks Pushing The Transportation 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 Transportation industry as a whole closed the day up 0.1% versus the S&P 500, which was unchanged. Laggards within the Transportation industry included Globus Maritime ( GLBS), down 2.2%, Danaos ( DAC), down 2.9%, China Eastern Airlines ( CEA), down 1.7%, Patriot Transportation Holdings ( PATR), down 2.0% and P AM Transportation ( PTSI), down 1.6%.

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

China Eastern Airlines ( CEA) is one of the companies that pushed the Transportation industry lower today. China Eastern Airlines was down $0.27 (1.7%) to $16.02 on light volume. Throughout the day, 7,663 shares of China Eastern Airlines exchanged hands as compared to its average daily volume of 16,000 shares. The stock ranged in price between $15.93-$16.04 after having opened the day at $16.03 as compared to the previous trading day's close of $16.29.

China Eastern Airlines has a market cap of $4.2 billion and is part of the services sector. Shares are down 15.3% year-to-date as of the close of trading on Friday. Currently there are 2 analysts who rate China Eastern Airlines a buy, no analysts rate it a sell, and none rate it a hold.

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At the close, Danaos ( DAC) was down $0.18 (2.9%) to $6.01 on light volume. Throughout the day, 5,660 shares of Danaos exchanged hands as compared to its average daily volume of 23,500 shares. The stock ranged in price between $6.01-$6.18 after having opened the day at $6.10 as compared to the previous trading day's close of $6.19.

Danaos Corporation, together with its subsidiaries, is engaged in the ownership and operation of containerships, as well as chartering of its vessels to liner companies in Greece and internationally. It primarily offers seaborne transportation services. Danaos has a market cap of $669.0 million and is part of the services sector. Shares are up 26.3% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate Danaos a buy, no analysts rate it a sell, and 2 rate it a hold.

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TheStreet Ratings rates Danaos as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, generally high debt management risk and weak operating cash flow.

Highlights from TheStreet Ratings analysis on DAC 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 Marine industry. The net income has significantly decreased by 37.4% when compared to the same quarter one year ago, falling from $13.43 million to $8.41 million.
  • The debt-to-equity ratio is very high at 5.02 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with this, the company manages to maintain a quick ratio of 0.23, which clearly demonstrates the inability to cover short-term cash needs.
  • Net operating cash flow has decreased to $39.30 million or 19.26% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • 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. When compared to other companies in the Marine industry and the overall market, DANAOS CORP's return on equity is below that of both the industry average and the S&P 500.
  • Compared to its closing price of one year ago, DAC's share price has jumped by 45.58%, exceeding the performance of the broader market during that same time frame. Looking ahead, however, we cannot assume that the stock's past performance is going to drive future results. Quite to the contrary, its sharp appreciation over the last year is one of the factors that should prompt investors to seek better opportunities elsewhere.

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

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Globus Maritime ( GLBS) was another company that pushed the Transportation industry lower today. Globus Maritime was down $0.08 (2.2%) to $3.52 on light volume. Throughout the day, 3,320 shares of Globus Maritime exchanged hands as compared to its average daily volume of 12,900 shares. The stock ranged in price between $3.51-$3.63 after having opened the day at $3.51 as compared to the previous trading day's close of $3.60.

Globus Maritime Limited, an integrated dry bulk shipping company, provides marine transportation services worldwide. It owns, operates, and manages a fleet of dry bulk vessels that transport iron ore, coal, grain, steel products, cement, alumina, and other dry bulk cargoes. Globus Maritime has a market cap of $37.2 million and is part of the services sector. Shares are down 9.1% year-to-date as of the close of trading on Friday. Currently there is 1 analyst who rates Globus Maritime a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Globus Maritime as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income and weak operating cash flow.

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 GLBS 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 Marine industry. The net income has decreased by 18.0% when compared to the same quarter one year ago, dropping from $1.32 million to $1.08 million.
  • Net operating cash flow has decreased to $2.81 million or 16.15% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • 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. When compared to other companies in the Marine industry and the overall market, GLOBUS MARITIME LTD's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for GLOBUS MARITIME LTD is rather high; currently it is at 50.14%. Regardless of GLBS's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, GLBS's net profit margin of 14.60% compares favorably to the industry average.
  • GLOBUS MARITIME LTD's earnings per share declined by 15.4% 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, GLOBUS MARITIME LTD turned its bottom line around by earning $0.52 versus -$8.20 in the prior year. This year, the market expects an improvement in earnings ($0.57 versus $0.52).

You can view the full analysis from the report here: Globus Maritime 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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