3 Stocks Driving The Materials & Construction Industry Higher

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.

All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 26 points (0.2%) at 16,807 as of Tuesday, June 17, 2014, 3:55 PM ET. The NYSE advances/declines ratio sits at 1,847 issues advancing vs. 1,167 declining with 138 unchanged.

The Materials & Construction industry as a whole closed the day up 0.4% versus the S&P 500, which was up 0.2%. Top gainers within the Materials & Construction industry included Industrial Services of America ( IDSA), up 15.9%, TRC Companies ( TRR), up 6.6%, Goldfield ( GV), up 3.5%, United States Lime & Minerals ( USLM), up 1.9% and Xinyuan Real Estate ( XIN), up 3.2%.

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

Xinyuan Real Estate ( XIN) is one of the companies that pushed the Materials & Construction industry higher today. Xinyuan Real Estate was up $0.13 (3.2%) to $4.15 on light volume. Throughout the day, 154,100 shares of Xinyuan Real Estate exchanged hands as compared to its average daily volume of 257,000 shares. The stock ranged in a price between $4.04-$4.19 after having opened the day at $4.04 as compared to the previous trading day's close of $4.02.

Xinyuan Real Estate Co., Ltd., together with its subsidiaries, develops residential real estate properties for middle-income consumers, primarily focusing on selected Tier II and III cities in China. Xinyuan Real Estate has a market cap of $323.2 million and is part of the industrial goods sector. Shares are down 24.9% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Xinyuan Real Estate 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 Xinyuan Real Estate as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, attractive valuation levels 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 weak growth in earnings per share.

Highlights from TheStreet Ratings analysis on XIN go as follows:

  • The revenue growth greatly exceeded the industry average of 41.2%. Since the same quarter one year prior, revenues rose by 33.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Even though the current debt-to-equity ratio is 1.04, it is still below the industry average, suggesting that this level of debt is acceptable within the Real Estate Management & Development industry. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.95 is weak.
  • 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 Real Estate Management & Development industry and the overall market on the basis of return on equity, XINYUAN REAL ESTATE CO -ADR has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • The share price of XINYUAN REAL ESTATE CO -ADR has not done very well: it is down 7.66% 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. Looking ahead, although the push and pull of the overall market trend could certainly make a critical difference, we do not see any strong reason stemming from the company's fundamentals that would cause a continuation of last year's decline. In fact, the stock is now selling for less than others in its industry in relation to its current earnings.

You can view the full analysis from the report here: Xinyuan Real Estate 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, TRC Companies ( TRR) was up $0.30 (6.6%) to $4.87 on heavy volume. Throughout the day, 55,040 shares of TRC Companies exchanged hands as compared to its average daily volume of 32,200 shares. The stock ranged in a price between $4.60-$4.94 after having opened the day at $4.60 as compared to the previous trading day's close of $4.57.

TRC Companies, Inc. provides engineering, consulting, and construction management services in the United States. TRC Companies has a market cap of $141.8 million and is part of the industrial goods sector. Shares are down 36.0% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate TRC Companies 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 TRC Companies as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, poor profit margins and a generally disappointing performance in the stock itself.

Highlights from TheStreet Ratings analysis on TRR go as follows:

  • TRR's revenue growth has slightly outpaced the industry average of 3.8%. Since the same quarter one year prior, revenues rose by 10.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • TRR'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 1.40, which illustrates the ability to avoid short-term cash problems.
  • 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 53.9% when compared to the same quarter one year ago, falling from $3.10 million to $1.43 million.
  • The gross profit margin for TRC COS INC is currently extremely low, coming in at 6.58%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.18% trails that of the industry average.

You can view the full analysis from the report here: TRC Companies 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.

Industrial Services of America ( IDSA) was another company that pushed the Materials & Construction industry higher today. Industrial Services of America was up $0.81 (15.9%) to $5.89 on heavy volume. Throughout the day, 68,303 shares of Industrial Services of America exchanged hands as compared to its average daily volume of 9,500 shares. The stock ranged in a price between $5.03-$6.19 after having opened the day at $5.09 as compared to the previous trading day's close of $5.08.

Industrial Services of America, Inc. operates as a recycler of stainless steel, ferrous, and non-ferrous scrap. The company operates in two segments, Recycling and Waste Services. Industrial Services of America has a market cap of $34.7 million and is part of the industrial goods sector. Shares are up 54.9% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Industrial Services of America a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Industrial Services of America 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 IDSA go as follows:

  • INDUSTRIAL SERVICES AMER 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. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, INDUSTRIAL SERVICES AMER INC reported poor results of -$1.96 versus -$0.96 in the prior year.
  • 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 460.9% when compared to the same quarter one year ago, falling from -$0.12 million to -$0.65 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 Commercial Services & Supplies industry and the overall market, INDUSTRIAL SERVICES AMER INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for INDUSTRIAL SERVICES AMER INC is currently extremely low, coming in at 6.10%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -2.51% trails that of the industry average.
  • IDSA, with its decline in revenue, underperformed when compared the industry average of 3.8%. Since the same quarter one year prior, revenues fell by 26.1%. 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: Industrial Services of America 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.

More from Markets

Oil Slumps, Gas Spikes Ahead of Holiday Weekend; Assessing the Chipmakers--ICYMI

Oil Slumps, Gas Spikes Ahead of Holiday Weekend; Assessing the Chipmakers--ICYMI

Week Ahead: Wall Street Looks to Jobs Report as North Korea Meeting Less Certain

Week Ahead: Wall Street Looks to Jobs Report as North Korea Meeting Less Certain

Dow and S&P 500 Decline, Energy Shares Fall as U.S. Crude Oil Slides 4%

Dow and S&P 500 Decline, Energy Shares Fall as U.S. Crude Oil Slides 4%

Replay: Jim Cramer on the Markets, 10-Year Yield, Oil Prices and Foot Locker

Replay: Jim Cramer on the Markets, 10-Year Yield, Oil Prices and Foot Locker

Video: You Could Live in a Ritz-Carlton or St. Regis Home

Video: You Could Live in a Ritz-Carlton or St. Regis Home