3 Stocks Pushing The Utilities 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 Utilities sector as a whole closed the day down 0.4% versus the S&P 500, which was up 0.2%. Laggards within the Utilities sector included GreenHunter Resources ( GRH), down 1.5%, Pure Cycle ( PCYO), down 1.8%, Transportadora de Gas del Sur ( TGS), down 3.8%, Ormat Technologies ( ORA), down 1.9% and Niska Gas Storage Partners ( NKA), down 2.5%.

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

Transportadora de Gas del Sur ( TGS) is one of the companies that pushed the Utilities sector lower today. Transportadora de Gas del Sur was down $0.13 (3.8%) to $3.30 on average volume. Throughout the day, 483,912 shares of Transportadora de Gas del Sur exchanged hands as compared to its average daily volume of 363,700 shares. The stock ranged in price between $3.21-$3.47 after having opened the day at $3.40 as compared to the previous trading day's close of $3.43.

Transportadora de Gas del Sur S.A. operates as a gas transportation company in Latin America. Transportadora de Gas del Sur has a market cap of $532.3 million and is part of the utilities industry. Shares are up 58.1% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Transportadora de Gas del Sur a buy, no analysts rate it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Transportadora de Gas del Sur as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from TheStreet Ratings analysis on TGS go as follows:

  • Compared to its closing price of one year ago, TGS's share price has jumped by 62.85%, exceeding the performance of the broader market during that same time frame. 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.
  • Net operating cash flow has slightly increased to $61.94 million or 9.98% when compared to the same quarter last year. Despite an increase in cash flow, TRANSPORTADORA DE GAS SUR's average is still marginally south of the industry average growth rate of 15.79%.
  • The revenue fell significantly faster than the industry average of 35.9%. Since the same quarter one year prior, revenues slightly dropped by 3.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • The gross profit margin for TRANSPORTADORA DE GAS SUR is currently lower than what is desirable, coming in at 32.96%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -6.26% is significantly below that of the industry average.
  • 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 Gas Utilities industry. The net income has significantly decreased by 143.9% when compared to the same quarter one year ago, falling from $22.29 million to -$9.78 million.

You can view the full analysis from the report here: Transportadora de Gas del Sur Ratings Report

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At the close, Pure Cycle ( PCYO) was down $0.12 (1.8%) to $6.53 on light volume. Throughout the day, 21,859 shares of Pure Cycle exchanged hands as compared to its average daily volume of 106,400 shares. The stock ranged in price between $6.48-$6.90 after having opened the day at $6.85 as compared to the previous trading day's close of $6.65.

Pure Cycle Corporation designs, constructs, operates, and maintains water and wastewater systems in the Denver metropolitan area. Pure Cycle has a market cap of $156.8 million and is part of the utilities industry. Shares are up 3.1% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates Pure Cycle a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Pure Cycle as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and impressive record of earnings per share growth. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.

Highlights from TheStreet Ratings analysis on PCYO go as follows:

  • PCYO's very impressive revenue growth greatly exceeded the industry average of 10.3%. Since the same quarter one year prior, revenues leaped by 69.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • PCYO's debt-to-equity ratio is very low at 0.09 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, PCYO has a quick ratio of 2.09, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 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. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Water Utilities industry and the overall market, PURE CYCLE CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$1.44 million or 193.26% 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: Pure Cycle Ratings Report

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GreenHunter Resources ( GRH) was another company that pushed the Utilities sector lower today. GreenHunter Resources was down $0.03 (1.5%) to $1.93 on light volume. Throughout the day, 99,498 shares of GreenHunter Resources exchanged hands as compared to its average daily volume of 198,300 shares. The stock ranged in price between $1.89-$1.96 after having opened the day at $1.95 as compared to the previous trading day's close of $1.96.

GreenHunter Resources has a market cap of $65.9 million and is part of the utilities industry. Shares are up 69.0% year-to-date as of the close of trading on Thursday. Currently there are 3 analysts who rate GreenHunter Resources a buy, no analysts rate it a sell, and none rate it a hold.

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Highlights from TheStreet Ratings analysis on GRH go as follows:

You can view the full analysis from the report here: GreenHunter Resources 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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