3 Consumer Goods Stocks Nudging The Sector 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.

Two out of the three major indices are trading lower today with the Dow Jones Industrial Average ( ^DJI) trading down 38.27 points (-0.2%) at 17,001 as of Friday, Aug. 22, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,124 issues advancing vs. 1,881 declining with 171 unchanged.

The Consumer Goods sector as a whole closed the day up 0.1% versus the S&P 500, which was down 0.2%. Top gainers within the Consumer Goods sector included Crystal Rock Holdings ( CRVP), up 2.1%, DS Healthcare Group ( DSKX), up 8.8%, Global-Tech Advanced Innovations ( GAI), up 2.5%, Exceed ( EDS), up 2.5% and American Lorain ( ALN), up 1.7%.

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

American Lorain ( ALN) is one of the companies that pushed the Consumer Goods sector higher today. American Lorain was up $0.02 (1.7%) to $1.22 on light volume. Throughout the day, 24,592 shares of American Lorain exchanged hands as compared to its average daily volume of 35,500 shares. The stock ranged in a price between $1.18-$1.22 after having opened the day at $1.20 as compared to the previous trading day's close of $1.20.

American Lorain Corporation, through its subsidiaries, develops, manufactures, and sells various food products in the People's Republic of China. It provides chestnut products, including aerated open-bottom chestnuts, sweetheart chestnuts, chestnuts in syrup, and golden chestnut kernels. American Lorain has a market cap of $41.5 million and is part of the consumer non-durables industry. Shares are up 51.9% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate American Lorain a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates American Lorain as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.

Highlights from TheStreet Ratings analysis on ALN go as follows:

  • Compared to its closing price of one year ago, ALN's share price has jumped by 43.22%, exceeding the performance of the broader market during that same time frame. 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 current debt-to-equity ratio, 0.51, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, ALN has a quick ratio of 1.68, which demonstrates the ability of the company to cover short-term liquidity needs.
  • ALN, with its decline in revenue, underperformed when compared the industry average of 2.6%. Since the same quarter one year prior, revenues slightly dropped by 9.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • AMERICAN LORAIN CORP's earnings per share declined by 28.6% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, AMERICAN LORAIN CORP reported lower earnings of $0.47 versus $0.59 in the prior year.
  • 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 Food Products industry. The net income has significantly decreased by 36.9% when compared to the same quarter one year ago, falling from $2.52 million to $1.59 million.

You can view the full analysis from the report here: American Lorain Ratings Report

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At the close, Exceed ( EDS) was up $0.04 (2.5%) to $1.66 on average volume. Throughout the day, 19,077 shares of Exceed exchanged hands as compared to its average daily volume of 20,100 shares. The stock ranged in a price between $1.61-$1.66 after having opened the day at $1.61 as compared to the previous trading day's close of $1.62.

Exceed Company Ltd. is engaged in the design, development, and wholesale of footwear, apparel, and accessories under the brand name of Xidelong in the People's Republic of China. Exceed has a market cap of $52.2 million and is part of the consumer non-durables industry. Shares are down 1.8% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Exceed 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 Exceed as a hold. 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 and attractive valuation levels. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, poor profit margins and weak operating cash flow.

Highlights from TheStreet Ratings analysis on EDS go as follows:

  • The revenue growth came in higher than the industry average of 10.3%. Since the same quarter one year prior, revenues rose by 33.7%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • EDS's debt-to-equity ratio is very low at 0.03 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 12.21, which clearly demonstrates the ability to cover short-term cash needs.
  • EXCEED CO LTD reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, EXCEED CO LTD reported lower earnings of $0.33 versus $0.96 in the prior year.
  • The gross profit margin for EXCEED CO LTD is currently lower than what is desirable, coming in at 27.28%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 4.36% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$13.97 million or 293.04% 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: Exceed 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.

DS Healthcare Group ( DSKX) was another company that pushed the Consumer Goods sector higher today. DS Healthcare Group was up $0.09 (8.8%) to $1.13 on average volume. Throughout the day, 15,983 shares of DS Healthcare Group exchanged hands as compared to its average daily volume of 15,000 shares. The stock ranged in a price between $1.07-$1.13 after having opened the day at $1.09 as compared to the previous trading day's close of $1.04.

DS Healthcare Group has a market cap of $17.9 million and is part of the consumer non-durables industry. Shares are down 57.5% year-to-date as of the close of trading on Thursday.

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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