3 Stocks Pushing The Wholesale Industry Lower

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The Wholesale industry as a whole closed the day down 0.4% versus the S&P 500, which was down 0.6%. Laggards within the Wholesale industry included Forward Industries ( FORD), down 3.0%, China Auto Logistics ( CALI), down 3.3%, NL Industries ( NL), down 1.6%, Wayside Technology Group ( WSTG), down 1.9% and Tessco Technologies ( TESS), down 2.0%.

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

Wayside Technology Group ( WSTG) is one of the companies that pushed the Wholesale industry lower today. Wayside Technology Group was down $0.31 (1.9%) to $16.44 on light volume. Throughout the day, 7,670 shares of Wayside Technology Group exchanged hands as compared to its average daily volume of 16,800 shares. The stock ranged in price between $16.41-$16.98 after having opened the day at $16.80 as compared to the previous trading day's close of $16.75.

Wayside Technology Group, Inc. operates as an information technology channel company in the United States and Canada. The company resells computer software and hardware developed by others, as well as provides technical services to customers primarily in the United States and Canada. Wayside Technology Group has a market cap of $81.4 million and is part of the services sector. Shares are up 23.8% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Wayside Technology Group 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, attractive valuation levels, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from TheStreet Ratings analysis on WSTG go as follows:

  • The revenue growth came in higher than the industry average of 3.6%. Since the same quarter one year prior, revenues rose by 13.9%. 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.
  • WSTG has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, WSTG has a quick ratio of 1.52, which demonstrates the ability of the company to cover short-term liquidity needs.
  • Compared to its closing price of one year ago, WSTG's share price has jumped by 29.14%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, WSTG should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • Net operating cash flow has significantly increased by 5138.46% to $2.62 million when compared to the same quarter last year. In addition, WAYSIDE TECHNOLOGY GROUP INC has also vastly surpassed the industry average cash flow growth rate of -20.62%.

You can view the full analysis from the report here: Wayside Technology Group Ratings Report

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At the close, NL Industries ( NL) was down $0.14 (1.6%) to $8.64 on light volume. Throughout the day, 9,336 shares of NL Industries exchanged hands as compared to its average daily volume of 19,600 shares. The stock ranged in price between $8.63-$8.80 after having opened the day at $8.72 as compared to the previous trading day's close of $8.78.

NL Industries, Inc., through its subsidiary, CompX International Inc., operates in the component products industry in the United States and internationally. NL Industries has a market cap of $426.0 million and is part of the services sector. Shares are down 21.5% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate NL Industries a buy, 1 analyst rates it a sell, and none rate it a hold.

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TheStreet Ratings rates NL Industries 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 expanding profit margins. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from TheStreet Ratings analysis on NL go as follows:

  • NL's revenue growth has slightly outpaced the industry average of 4.1%. Since the same quarter one year prior, revenues rose by 11.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • NL has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.74, which clearly demonstrates the ability to cover short-term cash needs.
  • NL INDUSTRIES reported significant earnings per share improvement 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, NL INDUSTRIES swung to a loss, reporting -$1.13 versus $1.16 in the prior year. This year, the market expects an improvement in earnings ($0.45 versus -$1.13).
  • NL has underperformed the S&P 500 Index, declining 20.69% 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.
  • 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. Compared to other companies in the Commercial Services & Supplies industry and the overall market, NL INDUSTRIES'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: NL Industries Ratings Report

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China Auto Logistics ( CALI) was another company that pushed the Wholesale industry lower today. China Auto Logistics was down $0.07 (3.3%) to $1.96 on light volume. Throughout the day, 309 shares of China Auto Logistics exchanged hands as compared to its average daily volume of 26,700 shares. The stock ranged in price between $1.96-$1.96 after having opened the day at $1.96 as compared to the previous trading day's close of $2.03.

China Auto Logistics Inc. sells and trades in imported automobiles in the People's Republic of China. China Auto Logistics has a market cap of $7.9 million and is part of the services sector. Shares are down 43.0% year-to-date as of the close of trading on Thursday.

TheStreet Ratings rates China Auto Logistics 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 poor profit margins.

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Highlights from TheStreet Ratings analysis on CALI go as follows:

  • The debt-to-equity ratio is very high at 3.51 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, CALI maintains a poor quick ratio of 0.72, which illustrates the inability to avoid short-term cash problems.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Specialty Retail industry and the overall market, CHINA AUTO LOGISTICS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for CHINA AUTO LOGISTICS INC is currently extremely low, coming in at 0.92%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -1.62% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$13.35 million or 621.85% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • CHINA AUTO LOGISTICS 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 reported a trend of declining earnings per share over the past two years. During the past fiscal year, CHINA AUTO LOGISTICS INC reported lower earnings of $0.16 versus $0.67 in the prior year.

You can view the full analysis from the report here: China Auto Logistics Ratings Report

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