3 Stocks Pushing The Automotive Industry Lower

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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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3 Stocks Pushing The Automotive Industry Lower