3 Stocks Pushing The Consumer Non-Durables Industry Lower

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The Consumer Non-Durables industry as a whole closed the day down 1.3% versus the S&P 500, which was down 0.4%. Laggards within the Consumer Non-Durables industry included CTI Industries ( CTIB), down 2.0%, Ever-Glory International Group ( EVK), down 5.2%, Weyco Group ( WEYS), down 4.0%, Verso Paper ( VRS), down 4.1% and Swisher Hygiene ( SWSH), down 4.0%.

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

Verso Paper ( VRS) is one of the companies that pushed the Consumer Non-Durables industry lower today. Verso Paper was down $0.11 (4.1%) to $2.56 on average volume. Throughout the day, 205,202 shares of Verso Paper exchanged hands as compared to its average daily volume of 140,100 shares. The stock ranged in price between $2.43-$2.70 after having opened the day at $2.58 as compared to the previous trading day's close of $2.67.

Verso Paper Corp. produces and sells coated papers in the United States. The company offers coated groundwood paper used primarily for catalogs and magazines; and coated freesheet paper used primarily for annual reports, brochures, and magazine covers. Verso Paper has a market cap of $145.0 million and is part of the consumer goods sector. Shares are up 326.8% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Verso Paper as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income and weak operating cash flow.

Highlights from TheStreet Ratings analysis on VRS go as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Paper & Forest Products industry. The net income has significantly decreased by 136.1% when compared to the same quarter one year ago, falling from -$38.38 million to -$90.61 million.
  • Net operating cash flow has decreased to -$96.28 million or 15.65% when compared to the same quarter last year. Despite a decrease in cash flow of 15.65%, VERSO PAPER CORP is in line with the industry average cash flow growth rate of -15.72%.
  • VRS, with its decline in revenue, slightly underperformed the industry average of 7.1%. Since the same quarter one year prior, revenues fell by 10.2%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • VERSO PAPER CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, VERSO PAPER CORP continued to lose money by earning -$2.09 versus -$3.29 in the prior year.
  • Compared to its closing price of one year ago, VRS's share price has jumped by 66.37%, exceeding the performance of the broader market during that same time frame. Regarding the future course of this stock, we feel that the risks involved in investing in VRS do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.

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

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At the close, Weyco Group ( WEYS) was down $1.09 (4.0%) to $26.39 on average volume. Throughout the day, 11,805 shares of Weyco Group exchanged hands as compared to its average daily volume of 11,800 shares. The stock ranged in price between $26.39-$27.14 after having opened the day at $27.14 as compared to the previous trading day's close of $27.48.

Weyco Group, Inc., together with its subsidiaries, is engaged in the distribution and retail of footwear. It operates in two segments, North American Wholesale and North American Retail. Weyco Group has a market cap of $296.5 million and is part of the consumer goods sector. Shares are down 6.6% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Weyco Group as a buy. 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, reasonable valuation levels, good cash flow from operations and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from TheStreet Ratings analysis on WEYS go as follows:

  • WEYS's revenue growth trails the industry average of 12.4%. Since the same quarter one year prior, revenues slightly increased by 1.8%. 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.
  • WEYS's debt-to-equity ratio is very low at 0.05 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 2.85, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has significantly increased by 125.32% to $8.30 million when compared to the same quarter last year. In addition, WEYCO GROUP INC has also vastly surpassed the industry average cash flow growth rate of -43.99%.
  • 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. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.

You can view the full analysis from the report here: Weyco 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 $0.09 (2.0%) to $4.49 on heavy volume. Throughout the day, 3,990 shares of CTI Industries exchanged hands as compared to its average daily volume of 1,400 shares. The stock ranged in price between $4.45-$4.49 after having opened the day at $4.45 as compared to the previous trading day's close of $4.59.

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 $15.0 million and is part of the consumer goods sector. Shares are down 21.4% 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 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

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