3 Stocks Pushing The Real Estate Industry Lower

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The Real Estate industry as a whole closed the day down 0.2% versus the S&P 500, which was up 0.1%. Laggards within the Real Estate industry included Vestin Realty Mortgage I ( VRTA), down 2.0%, China HGS Real Estate ( HGSH), down 2.3%, Amrep ( AXR), down 5.8%, Gladstone Land ( LAND), down 1.6% and Griffin Land & Nurseries ( GRIF), down 1.6%.

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

Gladstone Land ( LAND) is one of the companies that pushed the Real Estate industry lower today. Gladstone Land was down $0.20 (1.6%) to $12.10 on light volume. Throughout the day, 13,151 shares of Gladstone Land exchanged hands as compared to its average daily volume of 21,200 shares. The stock ranged in price between $11.99-$12.28 after having opened the day at $12.14 as compared to the previous trading day's close of $12.30.

Gladstone Land Corporation, an agricultural real estate company, owns and leases farmland to corporate and independent farmers in the United States. It also leases a parcel on its farm near Oxnard, California to an oil company. Gladstone Land has a market cap of $79.9 million and is part of the financial sector. Shares are down 24.5% year-to-date as of the close of trading on Tuesday. Currently there are 3 analysts who rate Gladstone Land a buy, no analysts rate it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Gladstone Land as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, poor profit margins, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from TheStreet Ratings analysis on LAND go as follows:

  • 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 Real Estate Management & Development industry. The net income has significantly decreased by 56.3% when compared to the same quarter one year ago, falling from $0.05 million to $0.02 million.
  • The gross profit margin for GLADSTONE LAND CORP is currently lower than what is desirable, coming in at 31.45%. It has decreased significantly from the same period last year. Along with this, the net profit margin of 1.39% trails that of the industry average.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 25.04%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 100.00% compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • GLADSTONE LAND 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. The company has reported a trend of declining earnings per share over the past year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, GLADSTONE LAND CORP swung to a loss, reporting -$0.19 versus $0.05 in the prior year. This year, the market expects an improvement in earnings ($0.07 versus -$0.19).
  • Compared to other companies in the Real Estate Management & Development industry and the overall market, GLADSTONE LAND 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: Gladstone Land Ratings Report

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