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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At the close, Integrated Electrical Services ( IESC) was down $0.35 (5.5%) to $5.89 on light volume. Throughout the day, 7,133 shares of Integrated Electrical Services exchanged hands as compared to its average daily volume of 11,000 shares. The stock ranged in price between $5.83-$6.18 after having opened the day at $6.18 as compared to the previous trading day's close of $6.24.

Integrated Electrical Services, Inc., through its subsidiaries, provides communications, residential, commercial and industrial, and infrastructure solutions in the United States. Integrated Electrical Services has a market cap of $108.9 million and is part of the industrial goods sector. Shares are up 12.8% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates Integrated Electrical Services as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that the company's profit margins have been poor overall.

Highlights from TheStreet Ratings analysis on IESC go as follows:

  • Powered by its strong earnings growth of 133.33% and other important driving factors, this stock has surged by 36.00% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • INTEGRATED ELECTRICAL SVCS reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. During the past fiscal year, INTEGRATED ELECTRICAL SVCS continued to lose money by earning -$0.14 versus -$0.18 in the prior year.
  • Despite the weak revenue results, IESC has outperformed against the industry average of 12.9%. Since the same quarter one year prior, revenues slightly dropped by 1.4%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Construction & Engineering industry and the overall market, INTEGRATED ELECTRICAL SVCS's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for INTEGRATED ELECTRICAL SVCS is rather low; currently it is at 17.19%. Regardless of IESC's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 0.32% trails the industry average.

You can view the full analysis from the report here: Integrated Electrical Services Ratings Report

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Ecology and Environment ( EEI) was another company that pushed the Materials & Construction industry lower today. Ecology and Environment was down $0.32 (3.0%) to $10.35 on light volume. Throughout the day, 3,677 shares of Ecology and Environment exchanged hands as compared to its average daily volume of 6,300 shares. The stock ranged in price between $10.35-$10.60 after having opened the day at $10.44 as compared to the previous trading day's close of $10.67.

Ecology and Environment, Inc., an environmental consulting firm, provides professional services to the government and private sectors worldwide. Ecology and Environment has a market cap of $28.0 million and is part of the industrial goods sector. Shares are down 3.9% year-to-date as of the close of trading on Friday.

TheStreet Ratings rates Ecology and Environment as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.

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Highlights from TheStreet Ratings analysis on EEI go as follows:

  • EEI's debt-to-equity ratio is very low at 0.07 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, EEI has a quick ratio of 1.91, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 44.47% is the gross profit margin for ECOLOGY AND ENVIRONMENT INC which we consider to be strong. Regardless of EEI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -2.69% trails the industry average.
  • EEI, with its decline in revenue, underperformed when compared the industry average of 3.9%. Since the same quarter one year prior, revenues fell by 19.6%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • 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, ECOLOGY AND ENVIRONMENT INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to $4.88 million or 48.13% 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: Ecology and Environment 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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