3 Stocks Pushing The Basic Materials 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 Basic Materials sector as a whole closed the day down 0.4% versus the S&P 500, which was up 0.4%. Laggards within the Basic Materials sector included Sonde Resources ( SOQ), down 7.6%, Atlatsa Resources ( ATL), down 5.3%, Ossen Innovation ( OSN), down 2.2%, Eurasian Minerals ( EMXX), down 3.2% and Lucas Energy ( LEI), down 3.9%.

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

Ossen Innovation ( OSN) is one of the companies that pushed the Basic Materials sector lower today. Ossen Innovation was down $0.02 (2.2%) to $0.90 on light volume. Throughout the day, 12,700 shares of Ossen Innovation exchanged hands as compared to its average daily volume of 24,600 shares. The stock ranged in price between $0.90-$0.94 after having opened the day at $0.93 as compared to the previous trading day's close of $0.92.

Ossen Innovation Co., Ltd. manufactures and sells various plain surface prestressed steel materials, and rare earth coated and zinc coated prestressed steel materials in the People's Republic of China. Ossen Innovation has a market cap of $18.1 million and is part of the energy industry. Shares are down 22.7% year-to-date as of the close of trading on Wednesday.

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 Ossen Innovation as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance and compelling growth in net income. However, as a counter to these strengths, we also find weaknesses including poor profit margins and weak operating cash flow.

Highlights from TheStreet Ratings analysis on OSN go as follows:

  • OSN's very impressive revenue growth greatly exceeded the industry average of 1.1%. Since the same quarter one year prior, revenues leaped by 92.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • This stock has managed to rise its share value by 95.82% over the past twelve months. 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.
  • 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 Metals & Mining industry and the overall market on the basis of return on equity, OSSEN INNOVATION CO LTD -ADR has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • The gross profit margin for OSSEN INNOVATION CO LTD -ADR is currently extremely low, coming in at 10.81%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.71% significantly trails the industry average.
  • Net operating cash flow has significantly decreased to -$1.13 million or 112.47% 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: Ossen Innovation 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, Atlatsa Resources ( ATL) was down $0.02 (5.3%) to $0.36 on light volume. Throughout the day, 29,835 shares of Atlatsa Resources exchanged hands as compared to its average daily volume of 46,400 shares. The stock ranged in price between $0.35-$0.40 after having opened the day at $0.40 as compared to the previous trading day's close of $0.38.

Atlatsa Resources Corporation mines, explores for, and develops platinum group metals properties in South Africa. The company primarily explores for platinum, palladium, rhodium, gold, copper, and nickel. Atlatsa Resources has a market cap of $199.5 million and is part of the energy industry. Shares are down 37.4% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Atlatsa Resources a buy, 1 analyst rates 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 Atlatsa Resources as a hold. The company's strengths can be seen in multiple areas, such as its notable return on equity, robust revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including poor profit margins and weak operating cash flow.

Highlights from TheStreet Ratings analysis on ATL go as follows:

  • Compared to other companies in the Metals & Mining industry and the overall market, ATLATSA RESOURCES CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The revenue growth came in higher than the industry average of 1.1%. Since the same quarter one year prior, revenues rose by 19.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period, despite the company's weak earnings results. Looking ahead, our view is that this company's fundamentals will not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
  • Net operating cash flow has declined marginally to -$27.73 million or 1.47% when compared to the same quarter last year. Despite a decrease in cash flow ATLATSA RESOURCES CORP is still fairing well by exceeding its industry average cash flow growth rate of -22.15%.
  • The gross profit margin for ATLATSA RESOURCES CORP is currently extremely low, coming in at 5.52%. Regardless of ATL's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, ATL's net profit margin of -9.05% significantly underperformed when compared to the industry average.

You can view the full analysis from the report here: Atlatsa 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.

Sonde Resources ( SOQ) was another company that pushed the Basic Materials sector lower today. Sonde Resources was down $0.02 (7.6%) to $0.23 on average volume. Throughout the day, 29,118 shares of Sonde Resources exchanged hands as compared to its average daily volume of 38,100 shares. The stock ranged in price between $0.23-$0.25 after having opened the day at $0.25 as compared to the previous trading day's close of $0.25.

Sonde Resources has a market cap of $10.1 million and is part of the energy industry. Shares are down 63.9% year-to-date as of the close of trading on Wednesday.

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

More from Markets

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

Inside Carnival's Mind Blowing New Horizon Cruise Ship (Video)

Jim Cramer: The 10-Year Yield Could Go to 2.75%

Jim Cramer: The 10-Year Yield Could Go to 2.75%

Oil Slumps, Gas Spikes Ahead of Holiday Weekend; Assessing the Chipmakers--ICYMI

Oil Slumps, Gas Spikes Ahead of Holiday Weekend; Assessing the Chipmakers--ICYMI

Week Ahead: Wall Street Looks to Jobs Report as North Korea Meeting Less Certain

Week Ahead: Wall Street Looks to Jobs Report as North Korea Meeting Less Certain

Dow and S&P 500 Decline, Energy Shares Fall as U.S. Crude Oil Slides 4%

Dow and S&P 500 Decline, Energy Shares Fall as U.S. Crude Oil Slides 4%