3 Stocks Pushing The Consumer Non-Durables 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 Consumer Non-Durables industry as a whole closed the day down 0.4% versus the S&P 500, which was down 0.1%. Laggards within the Consumer Non-Durables industry included CTI Industries ( CTIB), down 1.6%, China Shengda Packaging Group ( CPGI), down 4.2%, Ocean Bio-Chem ( OBCI), down 3.6%, CCA Industries ( CAW), down 1.6% and Orient Paper ( ONP), down 2.7%.

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

Orient Paper ( ONP) is one of the companies that pushed the Consumer Non-Durables industry lower today. Orient Paper was down $0.06 (2.7%) to $2.15 on average volume. Throughout the day, 45,346 shares of Orient Paper exchanged hands as compared to its average daily volume of 31,600 shares. The stock ranged in price between $2.14-$2.22 after having opened the day at $2.22 as compared to the previous trading day's close of $2.21.

Orient Paper, Inc. produces and distributes packaging and printing paper products in the People's Republic of China. It operates through two segments, Orient Paper HB and Orient Paper Shengde. Orient Paper has a market cap of $41.9 million and is part of the services sector. Shares are down 16.9% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Orient Paper as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and attractive valuation levels. 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 ONP go as follows:

  • The revenue growth greatly exceeded the industry average of 7.1%. Since the same quarter one year prior, revenues rose by 30.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 600.00% and other important driving factors, this stock has surged by 34.78% 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.
  • ONP's debt-to-equity ratio is very low at 0.27 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.43 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • 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. When compared to other companies in the Paper & Forest Products industry and the overall market, ORIENT PAPER INC's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for ORIENT PAPER INC is currently lower than what is desirable, coming in at 25.67%. Regardless of ONP's low profit margin, it has managed to increase from the same period last year.

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

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At the close, China Shengda Packaging Group ( CPGI) was down $0.05 (4.2%) to $1.08 on light volume. Throughout the day, 4,500 shares of China Shengda Packaging Group exchanged hands as compared to its average daily volume of 9,800 shares. The stock ranged in price between $1.01-$1.10 after having opened the day at $1.04 as compared to the previous trading day's close of $1.13.

China Shengda Packaging Group Inc., a paper packaging company, designs, manufactures, and sells flexo-printed and color-printed corrugated paper cartons of various sizes and strengths primarily in the People's Republic of China. China Shengda Packaging Group has a market cap of $40.7 million and is part of the services sector. Shares are up 32.9% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates China Shengda Packaging Group 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 good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income.

Highlights from TheStreet Ratings analysis on CPGI go as follows:

  • The revenue growth came in higher than the industry average of 5.8%. Since the same quarter one year prior, revenues rose by 19.2%. 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.
  • CPGI's debt-to-equity ratio is very low at 0.22 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 1.16, which illustrates the ability to avoid short-term cash problems.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Containers & Packaging industry and the overall market, CHINA SHENGDA PACKAGING GP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for CHINA SHENGDA PACKAGING GP is rather low; currently it is at 19.13%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -1.66% trails that of the industry average.

You can view the full analysis from the report here: China Shengda Packaging Group Ratings Report

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CTI Industries ( CTIB) was another company that pushed the Consumer Non-Durables industry lower today. CTI Industries was down $0.08 (1.6%) to $4.76 on light volume. Throughout the day, 600 shares of CTI Industries exchanged hands as compared to its average daily volume of 1,600 shares. The stock ranged in price between $4.71-$4.76 after having opened the day at $4.71 as compared to the previous trading day's close of $4.84.

CTI Industries Corporation develops, manufactures, and supplies flexible film products for novelty, packaging and container, and custom product applications worldwide. CTI Industries has a market cap of $16.0 million and is part of the services sector. Shares are down 17.1% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates CTI Industries as a sell. The company's weaknesses can be seen in multiple areas, such as its generally high debt management risk, unimpressive growth in net income and poor profit margins.

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Highlights from TheStreet Ratings analysis on CTIB go as follows:

  • The debt-to-equity ratio of 1.30 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, CTIB has a quick ratio of 0.59, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • The change in net income from the same quarter one year ago has exceeded that of the Household Durables industry average, but is less than that of the S&P 500. The net income has significantly decreased by 65.4% when compared to the same quarter one year ago, falling from $0.13 million to $0.05 million.
  • The gross profit margin for CTI INDUSTRIES CORP is currently lower than what is desirable, coming in at 27.08%. Regardless of CTIB'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 0.30% trails the industry average.
  • 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 Household Durables industry and the overall market, CTI INDUSTRIES CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. We feel that the combination of its price rise over the last year and its current price-to-earnings ratio relative to its industry tend to reduce its upside potential.

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

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