3 Stocks Pushing The Real Estate Industry 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 Real Estate industry as a whole closed the day down 0.1% versus the S&P 500, which was down 0.1%. Laggards within the Real Estate industry included Stratus Properties ( STRS), down 1.6%, Amrep ( AXR), down 4.4%, China Housing & Land Development ( CHLN), down 6.5%, Maui Land & Pineapple ( MLP), down 2.7% and Income Opportunity Realty Investors ( IOT), down 1.8%.

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

Maui Land & Pineapple ( MLP) is one of the companies that pushed the Real Estate industry lower today. Maui Land & Pineapple was down $0.19 (2.7%) to $6.78 on heavy volume. Throughout the day, 21,525 shares of Maui Land & Pineapple exchanged hands as compared to its average daily volume of 10,800 shares. The stock ranged in price between $6.71-$6.91 after having opened the day at $6.91 as compared to the previous trading day's close of $6.97.

Maui Land & Pineapple Company, Inc., together with its subsidiaries, develops, sells, and manages residential, resort, commercial, and industrial real estate properties. The company operates through four segments: Real Estate, Leasing, Utilities, and Resort Amenities. Maui Land & Pineapple has a market cap of $130.1 million and is part of the financial sector. Shares are up 14.4% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates Maui Land & Pineapple as a sell. Among the areas we feel are negative, one of the most important has been unimpressive growth in net income over time.

Highlights from TheStreet Ratings analysis on MLP 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 Real Estate Management & Development industry. The net income has significantly decreased by 42.6% when compared to the same quarter one year ago, falling from $0.83 million to $0.48 million.
  • 49.77% is the gross profit margin for MAUI LAND & PINEAPPLE CO which we consider to be strong. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 9.52% trails the industry average.
  • Net operating cash flow has significantly increased by 252.23% to $1.98 million when compared to the same quarter last year. In addition, MAUI LAND & PINEAPPLE CO has also vastly surpassed the industry average cash flow growth rate of -1.08%.
  • MAUI LAND & PINEAPPLE CO reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. During the past fiscal year, MAUI LAND & PINEAPPLE CO continued to lose money by earning -$0.14 versus -$0.27 in the prior year.
  • MLP's very impressive revenue growth greatly exceeded the industry average of 11.9%. Since the same quarter one year prior, revenues leaped by 96.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.

You can view the full analysis from the report here: Maui Land & Pineapple Ratings Report

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At the close, China Housing & Land Development ( CHLN) was down $0.11 (6.5%) to $1.57 on heavy volume. Throughout the day, 104,305 shares of China Housing & Land Development exchanged hands as compared to its average daily volume of 44,100 shares. The stock ranged in price between $1.56-$1.69 after having opened the day at $1.68 as compared to the previous trading day's close of $1.68.

China Housing & Land Development, Inc., a real estate development company, is engaged in the acquisition, development, management, and sale of commercial and residential real estate properties primarily in Xi'an, the People's Republic of China. China Housing & Land Development has a market cap of $57.5 million and is part of the financial sector. Shares are down 27.6% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates China Housing & Land Development as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, generally high debt management risk, disappointing return on equity and weak operating cash flow.

Highlights from TheStreet Ratings analysis on CHLN go as follows:

  • CHINA HOUSING & LAND DEV INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has suffered a declining pattern earnings per share over the past two years. During the past fiscal year, CHINA HOUSING & LAND DEV INC reported lower earnings of $0.34 versus $0.56 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 Real Estate Management & Development industry. The net income has significantly decreased by 126.9% when compared to the same quarter one year ago, falling from $2.87 million to -$0.77 million.
  • Although CHLN's debt-to-equity ratio of 2.45 is very high, it is currently less than that of the industry average.
  • 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. When compared to other companies in the Real Estate Management & Development industry and the overall market, CHINA HOUSING & LAND DEV INC's return on equity is below that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$30.61 million or 5758.78% 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 Housing & Land Development Ratings Report

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Amrep ( AXR) was another company that pushed the Real Estate industry lower today. Amrep was down $0.26 (4.4%) to $5.66 on heavy volume. Throughout the day, 25,062 shares of Amrep exchanged hands as compared to its average daily volume of 11,100 shares. The stock ranged in price between $5.58-$5.95 after having opened the day at $5.94 as compared to the previous trading day's close of $5.92.

AMREP Corporation, through its subsidiaries, is engaged in media services and real estate businesses in the United States. Amrep has a market cap of $48.3 million and is part of the financial sector. Shares are down 15.4% year-to-date as of the close of trading on Tuesday.

TheStreet Ratings rates Amrep as a sell. The company's weaknesses can be seen in multiple areas, such as its poor profit margins, weak operating cash flow and generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on AXR go as follows:

  • The gross profit margin for AMREP CORP is currently extremely low, coming in at 9.09%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -11.32% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$7.19 million or 579.20% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • AXR's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 38.93%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Commercial Services & Supplies industry average, but is greater than that of the S&P 500. The net income increased by 8.6% when compared to the same quarter one year prior, going from -$2.51 million to -$2.29 million.
  • 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 Commercial Services & Supplies industry and the overall market, AMREP CORP's return on equity significantly trails that of both the industry average and the S&P 500.

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

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