3 Stocks Raising The Materials & Construction Industry 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 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 Materials & Construction industry as a whole closed the day up 0.9% versus the S&P 500, which was up 0.5%. Top gainers within the Materials & Construction industry included Skyline ( SKY), up 5.1%, Comstock ( CHCI), up 1.7%, Lennar ( LEN.B), up 2.7%, UCP ( UCP), up 2.0% and China Recycling Energy ( CREG), up 5.6%.

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

China Recycling Energy ( CREG) is one of the companies that pushed the Materials & Construction industry higher today. China Recycling Energy was up $0.08 (5.6%) to $1.50 on average volume. Throughout the day, 403,051 shares of China Recycling Energy exchanged hands as compared to its average daily volume of 511,400 shares. The stock ranged in a price between $1.42-$1.54 after having opened the day at $1.44 as compared to the previous trading day's close of $1.42.

China Recycling Energy Corporation is engaged in the recycling energy business primarily in the People's Republic of China. China Recycling Energy has a market cap of $86.5 million and is part of the industrial goods sector. Shares are down 58.7% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate China Recycling Energy a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates China Recycling Energy as a hold. The company's strengths can be seen in multiple areas, such as its attractive valuation levels, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, weak operating cash flow and a generally disappointing performance in the stock itself.

Highlights from TheStreet Ratings analysis on CREG go as follows:

  • The gross profit margin for CHINA RECYCLING ENERGY CORP is currently very high, coming in at 99.81%. It has increased significantly from the same period last year. Along with this, the net profit margin of 48.17% significantly outperformed against the industry average.
  • The debt-to-equity ratio is somewhat low, currently at 0.78, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.89 is somewhat weak and could be cause for future problems.
  • 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 Commercial Services & Supplies industry average. The net income has decreased by 5.3% when compared to the same quarter one year ago, dropping from $3.30 million to $3.12 million.
  • Net operating cash flow has significantly decreased to -$17.75 million or 3186.78% 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: China Recycling Energy Ratings Report

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At the close, UCP ( UCP) was up $0.26 (2.0%) to $13.10 on average volume. Throughout the day, 48,773 shares of UCP exchanged hands as compared to its average daily volume of 40,000 shares. The stock ranged in a price between $12.77-$13.12 after having opened the day at $12.90 as compared to the previous trading day's close of $12.84.

UCP has a market cap of $100.8 million and is part of the industrial goods sector. Shares are down 12.3% year-to-date as of the close of trading on Monday.

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Comstock ( CHCI) was another company that pushed the Materials & Construction industry higher today. Comstock was up $0.02 (1.7%) to $1.22 on heavy volume. Throughout the day, 126,773 shares of Comstock exchanged hands as compared to its average daily volume of 51,500 shares. The stock ranged in a price between $1.18-$1.27 after having opened the day at $1.18 as compared to the previous trading day's close of $1.20.

Comstock Holding Companies, Inc. operates as a real estate development and construction services company in the United States. The company operates through three segments: Homebuilding, Multi-family, and Real Estate Services. Comstock has a market cap of $23.1 million and is part of the industrial goods sector. Shares are down 40.0% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Comstock a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Comstock as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, generally high debt management risk, disappointing return on equity, poor profit margins and weak operating cash flow.

Highlights from TheStreet Ratings analysis on CHCI 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 Household Durables industry. The net income has significantly decreased by 318.4% when compared to the same quarter one year ago, falling from $0.72 million to -$1.58 million.
  • The debt-to-equity ratio is very high at 10.87 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Household Durables industry and the overall market, COMSTOCK HOLDING COS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for COMSTOCK HOLDING COS INC is rather low; currently it is at 20.18%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -19.85% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$2.59 million or 163.52% 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: Comstock 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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