3 Stocks Pushing The Industrial Goods Sector Lower

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The Industrial Goods sector as a whole closed the day down 1.0% versus the S&P 500, which was down 0.1%. Laggards within the Industrial Goods sector included Art's-Way Manufacturing ( ARTW), down 1.6%, Tecumseh Products ( TECUB), down 1.7%, Skyline ( SKY), down 9.8%, TAT Technologies ( TATT), down 2.2% and Guanwei Recycling ( GPRC), down 5.2%.

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

Polypore International ( PPO) is one of the companies that pushed the Industrial Goods sector lower today. Polypore International was down $1.78 (4.1%) to $41.92 on heavy volume. Throughout the day, 567,752 shares of Polypore International exchanged hands as compared to its average daily volume of 325,600 shares. The stock ranged in price between $41.77-$43.81 after having opened the day at $43.78 as compared to the previous trading day's close of $43.70.

Polypore International, Inc. develops, manufactures, and markets specialized microporous membranes for the use in separation and filtration processes. Polypore International has a market cap of $2.0 billion and is part of the industrial industry. Shares are up 12.3% year-to-date as of the close of trading on Friday. Currently there are 4 analysts who rate Polypore International a buy, no analysts rate it a sell, and 5 rate it a hold.

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TheStreet Ratings rates Polypore International as a hold. The company's strengths can be seen in multiple areas, such as its 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 unimpressive growth in net income, disappointing return on equity and weak operating cash flow.

Highlights from TheStreet Ratings analysis on PPO go as follows:

  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 6.5%. Since the same quarter one year prior, revenues slightly dropped by 1.3%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • PPO's debt-to-equity ratio of 0.84 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.33 is sturdy.
  • 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 Electrical Equipment industry. The net income has significantly decreased by 131.6% when compared to the same quarter one year ago, falling from $15.44 million to -$4.89 million.
  • 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 Electrical Equipment industry and the overall market, POLYPORE INTERNATIONAL INC'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: Polypore International Ratings Report

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At the close, Guanwei Recycling ( GPRC) was down $0.04 (5.2%) to $0.73 on light volume. Throughout the day, 21,059 shares of Guanwei Recycling exchanged hands as compared to its average daily volume of 77,600 shares. The stock ranged in price between $0.71-$0.80 after having opened the day at $0.80 as compared to the previous trading day's close of $0.77.

Guanwei Recycling Corp. manufactures and distributes low density polyethylene (LDPE) and other recycled plastics products primarily in the People's Republic of China and internationally. Guanwei Recycling has a market cap of $7.0 million and is part of the industrial industry. Shares are down 73.3% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates Guanwei Recycling 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, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on GPRC go as follows:

  • GUANWEI RECYCLING CORP 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, GUANWEI RECYCLING CORP reported lower earnings of $0.93 versus $1.13 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 Commercial Services & Supplies industry. The net income has significantly decreased by 68.0% when compared to the same quarter one year ago, falling from $2.37 million to $0.76 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. When compared to other companies in the Commercial Services & Supplies industry and the overall market, GUANWEI RECYCLING CORP's return on equity is below that of both the industry average and the S&P 500.
  • The gross profit margin for GUANWEI RECYCLING CORP is rather low; currently it is at 16.86%. It has decreased significantly from the same period last year. Along with this, the net profit margin of 6.41% significantly trails the industry average.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 52.29%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 69.56% compared to the year-earlier 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.

You can view the full analysis from the report here: Guanwei Recycling 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.

Art's-Way Manufacturing ( ARTW) was another company that pushed the Industrial Goods sector lower today. Art's-Way Manufacturing was down $0.08 (1.6%) to $5.04 on light volume. Throughout the day, 4,110 shares of Art's-Way Manufacturing exchanged hands as compared to its average daily volume of 7,200 shares. The stock ranged in price between $5.02-$5.11 after having opened the day at $5.07 as compared to the previous trading day's close of $5.12.

Art's-Way Manufacturing Co., Inc. manufactures and sells agricultural equipment, specialized modular science buildings, pressurized steel vessels, and steel cutting tools in the United States and internationally. Art's-Way Manufacturing has a market cap of $20.6 million and is part of the industrial industry. Shares are down 15.9% year-to-date as of the close of trading on Friday.

TheStreet Ratings rates Art's-Way Manufacturing as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income.

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Highlights from TheStreet Ratings analysis on ARTW go as follows:

  • ARTW's revenue growth has slightly outpaced the industry average of 3.4%. Since the same quarter one year prior, revenues slightly increased by 2.4%. 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.
  • Net operating cash flow has significantly increased by 53.67% to -$0.62 million when compared to the same quarter last year. In addition, ARTS WAY MFG INC has also vastly surpassed the industry average cash flow growth rate of -24.04%.
  • The debt-to-equity ratio is somewhat low, currently at 0.65, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.43 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • ARTS WAY MFG 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, ARTS WAY MFG INC reported lower earnings of $0.38 versus $0.66 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 Machinery industry. The net income has significantly decreased by 50.9% when compared to the same quarter one year ago, falling from $0.52 million to $0.25 million.

You can view the full analysis from the report here: Art's-Way Manufacturing 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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