3 Stocks Boosting The Consumer Goods Sector Higher

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.

All three major indices are trading down today with the Dow Jones Industrial Average ( ^DJI) trading down 129.91 points (-0.8%) at 16,954 as of Friday, July 25, 2014, 3:55 PM ET. The NYSE advances/declines ratio sits at 978 issues advancing vs. 1,990 declining with 153 unchanged.

The Consumer Goods sector as a whole closed the day down 0.6% versus the S&P 500, which was down 0.6%. Top gainers within the Consumer Goods sector included Ocean Bio-Chem ( OBCI), up 1.6%, Virco Manufacturing ( VIRC), up 2.4%, Emerson Radio ( MSN), up 2.5%, Ballantyne Strong ( BTN), up 3.5% and STR Holdings ( STRI), up 1.6%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the sector higher today:

STR Holdings ( STRI) is one of the companies that pushed the Consumer Goods sector higher today. STR Holdings was up $0.02 (1.6%) to $1.31 on light volume. Throughout the day, 33,015 shares of STR Holdings exchanged hands as compared to its average daily volume of 116,600 shares. The stock ranged in a price between $1.27-$1.31 after having opened the day at $1.30 as compared to the previous trading day's close of $1.29.

STR Holdings, Inc., together with its subsidiaries, designs, develops, manufactures, and sells encapsulants for solar module manufacturers worldwide. Its encapsulants protect the embedded semiconductor circuits of solar panels. STR Holdings has a market cap of $34.3 million and is part of the consumer durables industry. Shares are down 17.8% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate STR Holdings a buy, no analysts rate it a sell, and 1 rates it a hold.

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

TheStreet Ratings rates STR Holdings as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on STRI go as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Semiconductors & Semiconductor Equipment industry average. The net income has decreased by 10.3% when compared to the same quarter one year ago, dropping from -$4.21 million to -$4.64 million.
  • Net operating cash flow has significantly decreased to -$4.91 million or 67.87% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Looking at the price performance of STRI's shares over the past 12 months, there is not much good news to report: the stock is down 53.10%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • 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 Semiconductors & Semiconductor Equipment industry and the overall market, STR HOLDINGS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • STRI, with its decline in revenue, underperformed when compared the industry average of 9.7%. Since the same quarter one year prior, revenues fell by 16.8%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

You can view the full analysis from the report here: STR Holdings 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.

At the close, Ballantyne Strong ( BTN) was up $0.13 (3.5%) to $3.90 on light volume. Throughout the day, 16,774 shares of Ballantyne Strong exchanged hands as compared to its average daily volume of 36,400 shares. The stock ranged in a price between $3.75-$3.90 after having opened the day at $3.75 as compared to the previous trading day's close of $3.77.

Ballantyne Strong, Inc. designs, integrates, and installs technology solutions for retail, financial, government, and cinema markets worldwide. The company operates in two segments, Systems Integration and Managed Services. Ballantyne Strong has a market cap of $54.4 million and is part of the consumer durables industry. Shares are down 16.9% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Ballantyne Strong a buy, no analysts rate it a sell, and none rate it a hold.

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

TheStreet Ratings rates Ballantyne Strong as a hold. Among the primary strengths of the company is its solid financial position based on a variety of debt and liquidity measures that we have evaluated. At the same time, however, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.

Highlights from TheStreet Ratings analysis on BTN go as follows:

  • BTN 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. To add to this, BTN has a quick ratio of 2.45, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The revenue fell significantly faster than the industry average of 14.7%. Since the same quarter one year prior, revenues fell by 20.3%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The share price of BALLANTYNE STRONG INC has not done very well: it is down 13.26% 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. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • 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 Media industry. The net income has significantly decreased by 205.1% when compared to the same quarter one year ago, falling from $0.57 million to -$0.59 million.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Media industry and the overall market, BALLANTYNE STRONG INC'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: Ballantyne Strong 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.

Virco Manufacturing ( VIRC) was another company that pushed the Consumer Goods sector higher today. Virco Manufacturing was up $0.06 (2.4%) to $2.52 on heavy volume. Throughout the day, 122,582 shares of Virco Manufacturing exchanged hands as compared to its average daily volume of 9,200 shares. The stock ranged in a price between $2.34-$2.65 after having opened the day at $2.46 as compared to the previous trading day's close of $2.46.

Virco Mfg. Corporation is engaged in the design, production, and distribution of furniture for the commercial and education markets in the United States. Virco Manufacturing has a market cap of $33.9 million and is part of the consumer durables industry. Shares are up 7.2% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Virco Manufacturing a buy, no analysts rate it a sell, and 1 rates it a hold.

TheStreet Ratings rates Virco Manufacturing as a sell. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on VIRC go as follows:

  • In its most recent trading session, VIRC has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Commercial Services & Supplies industry average, but is greater than that of the S&P 500. The net income increased by 13.3% when compared to the same quarter one year prior, going from -$4.45 million to -$3.86 million.
  • 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 Commercial Services & Supplies industry and the overall market, VIRCO MFG. CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The debt-to-equity ratio is somewhat low, currently at 0.85, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.27 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • 39.30% is the gross profit margin for VIRCO MFG. CORP 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 -16.38% is in-line with the industry average.

You can view the full analysis from the report here: Virco Manufacturing 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.

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.

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