3 Stocks Pushing The Consumer Goods Sector 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 Goods sector as a whole closed the day down 1.0% versus the S&P 500, which was down 0.5%. Laggards within the Consumer Goods sector included CTI Industries ( CTIB), down 3.1%, China Shengda Packaging Group ( CPGI), down 8.9%, Molson Coors Brewing ( TAP.A), down 2.1%, Leading Brands ( LBIX), down 3.8% and DS Healthcare Group ( DSKX), down 1.9%.

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

Leading Brands ( LBIX) is one of the companies that pushed the Consumer Goods sector lower today. Leading Brands was down $0.18 (3.8%) to $4.60 on heavy volume. Throughout the day, 19,465 shares of Leading Brands exchanged hands as compared to its average daily volume of 3,600 shares. The stock ranged in price between $4.50-$4.78 after having opened the day at $4.78 as compared to the previous trading day's close of $4.78.

Leading Brands, Inc., together with its subsidiaries, is engaged in the development, production, marketing, and distribution of beverages in Canada, the western United States, and Asia. Leading Brands has a market cap of $13.9 million and is part of the automotive industry. Shares are up 23.5% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Leading Brands as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and reasonable valuation levels. However, as a counter to these strengths, we find that the growth in the company's net income has been quite unimpressive.

Highlights from TheStreet Ratings analysis on LBIX go as follows:

  • Compared to its closing price of one year ago, LBIX's share price has jumped by 35.14%, exceeding the performance of the broader market during that same time frame. Although LBIX had significant growth over the past year, our hold rating indicates that we do not recommend additional investment in this stock at the current time.
  • LBIX's debt-to-equity ratio is very low at 0.01 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 1.42, which illustrates the ability to avoid short-term cash problems.
  • 39.63% is the gross profit margin for LEADING BRANDS INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -1.75% is in-line with 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. When compared to other companies in the Beverages industry and the overall market, LEADING BRANDS INC's return on equity is below that of both the industry average and the S&P 500.
  • 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 Beverages industry. The net income has significantly decreased by 48.6% when compared to the same quarter one year ago, falling from -$0.04 million to -$0.06 million.

You can view the full analysis from the report here: Leading Brands Ratings Report

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At the close, China Shengda Packaging Group ( CPGI) was down $0.09 (8.9%) to $0.92 on heavy volume. Throughout the day, 18,500 shares of China Shengda Packaging Group exchanged hands as compared to its average daily volume of 8,700 shares. The stock ranged in price between $0.91-$0.97 after having opened the day at $0.97 as compared to the previous trading day's close of $1.01.

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 $39.2 million and is part of the automotive industry. Shares are up 18.8% year-to-date as of the close of trading on Thursday.

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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 5.7%. 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

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

CTI Industries ( CTIB) was another company that pushed the Consumer Goods sector lower today. CTI Industries was down $0.14 (3.1%) to $4.55 on light volume. Throughout the day, 700 shares of CTI Industries exchanged hands as compared to its average daily volume of 1,400 shares. The stock ranged in price between $4.55-$4.55 after having opened the day at $4.55 as compared to the previous trading day's close of $4.70.

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 $15.5 million and is part of the automotive industry. Shares are down 19.6% year-to-date as of the close of trading on Thursday.

TheStreet Ratings rates CTI Industries as a sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, 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 share price of CTI INDUSTRIES CORP has not done very well: it is down 5.92% 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, other than the push or pull of the broad market, we do not see anything in the company's numbers that may help reverse the decline experienced over the past 12 months. Despite the past decline, the stock is still selling for more than most others in its industry.
  • 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.

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