3 Stocks Pushing The Automotive 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 Automotive industry as a whole closed the day down 1.1% versus the S&P 500, which was down 0.6%. Laggards within the Automotive industry included Shiloh Industries ( SHLO), down 1.6%, Remy International ( REMY), down 1.6%, Accuride ( ACW), down 2.8%, Spartan Motors ( SPAR), down 2.5% and Stoneridge ( SRI), down 1.6%.

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

Accuride ( ACW) is one of the companies that pushed the Automotive industry lower today. Accuride was down $0.13 (2.8%) to $4.49 on light volume. Throughout the day, 98,212 shares of Accuride exchanged hands as compared to its average daily volume of 212,200 shares. The stock ranged in price between $4.48-$4.63 after having opened the day at $4.63 as compared to the previous trading day's close of $4.62.

Accuride Corporation, together with its subsidiaries, designs, manufactures, and distributes commercial vehicle components in North America. Its products include commercial vehicle wheels, wheel-end components and assemblies, and ductile and gray iron castings. Accuride has a market cap of $214.3 million and is part of the consumer goods sector. Shares are up 23.9% year-to-date as of the close of trading on Thursday. Currently there are 2 analysts who rate Accuride a buy, no analysts rate it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Accuride as a sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, generally high debt management risk and poor profit margins.

Highlights from TheStreet Ratings analysis on ACW go as follows:

  • ACW has underperformed the S&P 500 Index, declining 17.46% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The debt-to-equity ratio is very high at 5.24 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, ACW's quick ratio is somewhat strong at 1.07, demonstrating the ability to handle short-term liquidity needs.
  • The gross profit margin for ACCURIDE CORP is rather low; currently it is at 16.85%. Regardless of ACW's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 2.91% trails the industry average.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Machinery industry and the overall market, ACCURIDE CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly increased by 154.09% to $18.97 million when compared to the same quarter last year. In addition, ACCURIDE CORP has also vastly surpassed the industry average cash flow growth rate of -24.04%.

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

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At the close, Remy International ( REMY) was down $0.35 (1.6%) to $21.69 on average volume. Throughout the day, 52,302 shares of Remy International exchanged hands as compared to its average daily volume of 43,200 shares. The stock ranged in price between $21.63-$22.11 after having opened the day at $22.11 as compared to the previous trading day's close of $22.04.

Remy International, Inc. designs, manufactures, remanufactures, markets, and distributes rotating electrical components for automobiles, light trucks, heavy-duty trucks, and other vehicles primarily in North America, Europe, Latin America, and the Asia-Pacific. Remy International has a market cap of $693.3 million and is part of the consumer goods sector. Shares are down 5.5% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates Remy International a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Remy International as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and weak operating cash flow.

Highlights from TheStreet Ratings analysis on REMY go as follows:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 8.9%. Since the same quarter one year prior, revenues slightly increased by 6.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • The current debt-to-equity ratio, 0.60, is low and is below the industry average, implying that there has been successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.96 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 the Auto Components industry average. The net income has decreased by 12.4% when compared to the same quarter one year ago, dropping from $11.37 million to $9.96 million.
  • 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. In comparison to the other companies in the Auto Components industry and the overall market, REMY INTERNATIONAL INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.

You can view the full analysis from the report here: Remy International Ratings Report

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Shiloh Industries ( SHLO) was another company that pushed the Automotive industry lower today. Shiloh Industries was down $0.29 (1.6%) to $17.53 on average volume. Throughout the day, 39,047 shares of Shiloh Industries exchanged hands as compared to its average daily volume of 44,700 shares. The stock ranged in price between $17.44-$17.89 after having opened the day at $17.89 as compared to the previous trading day's close of $17.82.

Shiloh Industries, Inc., together with its subsidiaries, provides light weighting, as well as noise, vibration, and harshness solutions to automotive, commercial vehicle, and other industrial markets. Shiloh Industries has a market cap of $304.9 million and is part of the consumer goods sector. Shares are down 8.6% year-to-date as of the close of trading on Thursday.

TheStreet Ratings rates Shiloh Industries as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and attractive valuation levels. We feel these strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated.

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Highlights from TheStreet Ratings analysis on SHLO go as follows:

  • The revenue growth came in higher than the industry average of 8.9%. Since the same quarter one year prior, revenues rose by 30.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 58.06% and other important driving factors, this stock has surged by 51.11% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, SHLO should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • SHILOH INDUSTRIES INC 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, SHILOH INDUSTRIES INC increased its bottom line by earning $1.27 versus $0.79 in the prior year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Auto Components industry. The net income increased by 58.0% when compared to the same quarter one year prior, rising from $5.28 million to $8.35 million.

You can view the full analysis from the report here: Shiloh Industries 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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