3 Stocks Pushing The Food & Beverage Industry Lower

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The Food & Beverage industry as a whole was unchanged today versus the S&P 500, which was up 0.2%. Laggards within the Food & Beverage industry included Seneca Foods ( SENEB), down 2.6%, Bridgford Foods ( BRID), down 4.4%, Truett-Hurst Inc Class A ( THST), down 2.7%, Crumbs Bake Shop ( CRMB), down 6.5% and American Lorain ( ALN), down 4.3%.

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

American Lorain ( ALN) is one of the companies that pushed the Food & Beverage industry lower today. American Lorain was down $0.05 (4.3%) to $1.10 on light volume. Throughout the day, 37,867 shares of American Lorain exchanged hands as compared to its average daily volume of 66,900 shares. The stock ranged in price between $1.08-$1.10 after having opened the day at $1.10 as compared to the previous trading day's close of $1.15.

American Lorain Corporation, through its subsidiaries, develops, manufactures, and sells various food products in the People's Republic of China. It provides chestnut products, including aerated open-bottom chestnuts, sweetheart chestnuts, chestnuts in syrup, and golden chestnut kernels. American Lorain has a market cap of $38.8 million and is part of the consumer goods sector. Shares are up 45.6% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates American Lorain 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, attractive valuation levels and good cash flow from operations. 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 ALN go as follows:

  • The current debt-to-equity ratio, 0.51, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, ALN has a quick ratio of 1.68, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Net operating cash flow has significantly increased by 614.58% to $7.02 million when compared to the same quarter last year. In addition, AMERICAN LORAIN CORP has also vastly surpassed the industry average cash flow growth rate of -16.09%.
  • ALN, with its decline in revenue, underperformed when compared the industry average of 3.5%. Since the same quarter one year prior, revenues slightly dropped by 9.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • In its most recent trading session, ALN 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. 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: American Lorain Ratings Report

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