3 Stocks Moving The Basic Materials Sector Upward

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 traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 81 points (0.5%) at 16,920 as of Tuesday, Aug. 19, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,954 issues advancing vs. 1,082 declining with 162 unchanged.

The Basic Materials sector as a whole closed the day up 0.4% versus the S&P 500, which was up 0.5%. Top gainers within the Basic Materials sector included Sonde Resources ( SOQ), up 17.1%, Barnwell Industries ( BRN), up 2.7%, Atlatsa Resources ( ATL), up 2.4%, Ossen Innovation ( OSN), up 2.3% and Minco Gold ( MGH), up 2.8%.

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

Ossen Innovation ( OSN) is one of the companies that pushed the Basic Materials sector higher today. Ossen Innovation was up $0.02 (2.3%) to $0.88 on light volume. Throughout the day, 11,619 shares of Ossen Innovation exchanged hands as compared to its average daily volume of 24,100 shares. The stock ranged in a price between $0.88-$0.91 after having opened the day at $0.91 as compared to the previous trading day's close of $0.86.

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 $17.9 million and is part of the energy industry. Shares are down 27.7% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Ossen Innovation a buy, no analysts rate it a sell, and none rate it a hold.

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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 3.2%. 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 40.62% 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

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At the close, Atlatsa Resources ( ATL) was up $0.01 (2.4%) to $0.34 on average volume. Throughout the day, 48,204 shares of Atlatsa Resources exchanged hands as compared to its average daily volume of 47,900 shares. The stock ranged in a price between $0.33-$0.35 after having opened the day at $0.35 as compared to the previous trading day's close of $0.33.

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 $185.7 million and is part of the energy industry. Shares are down 41.7% year-to-date as of the close of trading on Monday. Currently there is 1 analyst who rates Atlatsa Resources 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 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 3.2%. 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.
  • Compared to where it was a year ago today, the stock is now trading at a higher level, regardless of 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 -23.48%.
  • 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 higher today. Sonde Resources was up $0.04 (17.1%) to $0.24 on light volume. Throughout the day, 27,798 shares of Sonde Resources exchanged hands as compared to its average daily volume of 40,800 shares. The stock ranged in a price between $0.20-$0.24 after having opened the day at $0.22 as compared to the previous trading day's close of $0.20.

Sonde Resources has a market cap of $11.8 million and is part of the energy industry. Shares are down 70.3% year-to-date as of the close of trading on Monday.

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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