3 Stocks Pushing The Metals & Mining Industry Lower

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The Metals & Mining industry as a whole closed the day down 1.0% versus the S&P 500, which was up 0.8%. Laggards within the Metals & Mining industry included Atlatsa Resources ( ATL), down 3.0%, Entree Gold ( EGI), down 3.7%, China Gerui Advanced Materials Group ( CHOP), down 9.1%, Quest Rare Minerals ( QRM), down 7.3% and Mines Management ( MGN), down 8.8%.

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

China Gerui Advanced Materials Group ( CHOP) is one of the companies that pushed the Metals & Mining industry lower today. China Gerui Advanced Materials Group was down $0.03 (9.1%) to $0.30 on heavy volume. Throughout the day, 218,374 shares of China Gerui Advanced Materials Group exchanged hands as compared to its average daily volume of 85,500 shares. The stock ranged in price between $0.30-$0.35 after having opened the day at $0.33 as compared to the previous trading day's close of $0.33.

China Gerui Advanced Materials Group Limited operates as a contract manufacturer of cold-rolled narrow strip steel products in the People's Republic of China and internationally. The company converts steel manufactured by third parties into thin steel sheets and strips. China Gerui Advanced Materials Group has a market cap of $20.8 million and is part of the basic materials sector. Shares are down 72.0% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates China Gerui Advanced Materials Group 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 weak operating cash flow.

Highlights from TheStreet Ratings analysis on CHOP go as follows:

  • CHINA GERUI ADV MATERIALS GP 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 GERUI ADV MATERIALS GP swung to a loss, reporting -$0.23 versus $0.45 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 Metals & Mining industry. The net income has significantly decreased by 61.9% when compared to the same quarter one year ago, falling from -$0.85 million to -$1.37 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 Metals & Mining industry and the overall market on the basis of return on equity, CHINA GERUI ADV MATERIALS GP underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • The gross profit margin for CHINA GERUI ADV MATERIALS GP is currently extremely low, coming in at 14.97%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -4.18% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$228.80 million or 766.69% 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 Gerui Advanced Materials Group Ratings Report

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At the close, Entree Gold ( EGI) was down $0.01 (3.7%) to $0.26 on light volume. Throughout the day, 7,650 shares of Entree Gold exchanged hands as compared to its average daily volume of 74,100 shares. The stock ranged in price between $0.26-$0.28 after having opened the day at $0.27 as compared to the previous trading day's close of $0.27.

Entree Gold has a market cap of $38.5 million and is part of the basic materials sector. Shares are down 6.5% year-to-date as of the close of trading on Tuesday.

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Atlatsa Resources ( ATL) was another company that pushed the Metals & Mining industry lower today. Atlatsa Resources was down $0.01 (3.0%) to $0.30 on light volume. Throughout the day, 33,968 shares of Atlatsa Resources exchanged hands as compared to its average daily volume of 45,300 shares. The stock ranged in price between $0.30-$0.31 after having opened the day at $0.31 as compared to the previous trading day's close of $0.31.

Atlatsa Resources Corporation mines, explores for, and develops platinum group metals properties in South Africa. The company primarily explores for platinum, palladium, rhodium, gold, copper, and nickel. Atlatsa Resources has a market cap of $171.8 million and is part of the basic materials sector. Shares are down 46.1% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates Atlatsa Resources a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Atlatsa Resources as a hold. The company's strengths can be seen in multiple areas, such as its notable return on equity, robust revenue growth and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including poor profit margins and a generally disappointing performance in the stock itself.

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Highlights from TheStreet Ratings analysis on ATL go as follows:

  • Compared to other companies in the Metals & Mining industry and the overall market, ATLATSA RESOURCES CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The revenue growth came in higher than the industry average of 0.6%. Since the same quarter one year prior, revenues rose by 20.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • The current debt-to-equity ratio, 0.49, 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 0.83 is somewhat weak and could be cause for future problems.
  • ATL has underperformed the S&P 500 Index, declining 17.95% 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 gross profit margin for ATLATSA RESOURCES CORP is currently extremely low, coming in at 4.14%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -11.90% is significantly below that of the industry average.

You can view the full analysis from the report here: Atlatsa Resources 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.