3 Stocks Pushing The Industrial Industry Lower

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The Industrial industry as a whole closed the day down 0.2% versus the S&P 500, which was up 0.2%. Laggards within the Industrial industry included Global-Tech Advanced Innovations ( GAI), down 2.3%, Bonso Electronics International ( BNSO), down 5.0%, Intelligent Systems ( INS), down 4.0%, American Electric Technologies ( AETI), down 1.9% and LSI Industries ( LYTS), down 5.1%.

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

Regal-Beloit ( RBC) is one of the companies that pushed the Industrial industry lower today. Regal-Beloit was down $1.13 (1.6%) to $70.03 on heavy volume. Throughout the day, 484,095 shares of Regal-Beloit exchanged hands as compared to its average daily volume of 247,500 shares. The stock ranged in price between $68.89-$70.38 after having opened the day at $70.22 as compared to the previous trading day's close of $71.16.

Regal Beloit Corporation, together with its subsidiaries, designs, manufactures, and sells electric motors and controls, electric generators and controls, low and medium voltage drives and soft starters, and mechanical motion control products in the United States and internationally. Regal-Beloit has a market cap of $3.2 billion and is part of the industrial goods sector. Shares are down 3.5% year-to-date as of the close of trading on Tuesday. Currently there are 5 analysts who rate Regal-Beloit a buy, no analysts rate it a sell, and 5 rate it a hold.

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TheStreet Ratings rates Regal-Beloit as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, increase in net income and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from TheStreet Ratings analysis on RBC go as follows:

  • RBC's revenue growth has slightly outpaced the industry average of 6.5%. Since the same quarter one year prior, revenues slightly increased by 3.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.36, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.33, which illustrates the ability to avoid short-term cash problems.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Electrical Equipment industry average. The net income increased by 10.0% when compared to the same quarter one year prior, going from $51.10 million to $56.20 million.
  • Net operating cash flow has slightly increased to $99.50 million or 8.98% when compared to the same quarter last year. In addition, REGAL-BELOIT CORP has also modestly surpassed the industry average cash flow growth rate of 3.06%.
  • REGAL-BELOIT CORP has improved earnings per share by 9.7% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, REGAL-BELOIT CORP reported lower earnings of $2.64 versus $4.64 in the prior year. This year, the market expects an improvement in earnings ($4.40 versus $2.64).

You can view the full analysis from the report here: Regal-Beloit Ratings Report

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