3 Stocks Pushing The Materials & Construction Industry Lower

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The Materials & Construction industry as a whole closed the day down 0.6% versus the S&P 500, which was down 0.1%. Laggards within the Materials & Construction industry included Avalon Holdings ( AWX), down 3.0%, Ecology and Environment ( EEI), down 3.0%, Integrated Electrical Services ( IESC), down 5.5%, Skyline ( SKY), down 2.7% and Sharps Compliance ( SMED), down 3.8%.

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

Sharps Compliance ( SMED) is one of the companies that pushed the Materials & Construction industry lower today. Sharps Compliance was down $0.17 (3.8%) to $4.35 on light volume. Throughout the day, 22,808 shares of Sharps Compliance exchanged hands as compared to its average daily volume of 33,800 shares. The stock ranged in price between $4.31-$4.45 after having opened the day at $4.38 as compared to the previous trading day's close of $4.52.

Sharps Compliance Corp. provides management solutions for medical waste, used healthcare materials, and unused dispensed medications in the United States. Sharps Compliance has a market cap of $68.7 million and is part of the industrial goods sector. Shares are down 4.4% year-to-date as of the close of trading on Friday. Currently there are 3 analysts who rate Sharps Compliance a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Sharps Compliance as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including poor profit margins and weak operating cash flow.

Highlights from TheStreet Ratings analysis on SMED go as follows:

  • SMED's revenue growth trails the industry average of 16.8%. Since the same quarter one year prior, revenues slightly increased by 2.6%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • SMED has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 4.54, which clearly demonstrates the ability to cover short-term cash needs.
  • SHARPS COMPLIANCE CORP reported flat earnings per share in the most recent quarter. 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, SHARPS COMPLIANCE CORP continued to lose money by earning -$0.18 versus -$0.23 in the prior year. This year, the market expects an improvement in earnings (-$0.05 versus -$0.18).
  • The gross profit margin for SHARPS COMPLIANCE CORP is currently lower than what is desirable, coming in at 28.26%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -16.84% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$0.83 million or 59.88% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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

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