3 Stocks Pushing The Basic Materials Sector 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 Basic Materials sector as a whole closed the day down 1.6% versus the S&P 500, which was down 1.6%. Laggards within the Basic Materials sector included Sonde Resources ( SOQ), down 13.3%, Atlatsa Resources ( ATL), down 4.2%, Pacific Booker Minerals ( PBM), down 5.7%, Oxford Resource Partners ( OXF), down 6.5% and Mines Management ( MGN), down 1.6%.

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

Oxford Resource Partners ( OXF) is one of the companies that pushed the Basic Materials sector lower today. Oxford Resource Partners was down $0.06 (6.5%) to $0.82 on light volume. Throughout the day, 15,864 shares of Oxford Resource Partners exchanged hands as compared to its average daily volume of 33,200 shares. The stock ranged in price between $0.81-$0.88 after having opened the day at $0.85 as compared to the previous trading day's close of $0.88.

Oxford Resource Partners, LP produces and markets thermal coal in the United States. The company markets its thermal coal to utilities, industrial customers, municipalities, and other coal-related entities. Oxford Resource Partners has a market cap of $9.3 million and is part of the energy industry. Shares are down 28.6% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Oxford Resource Partners a buy, no analysts rate it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Oxford Resource Partners as a sell. The company's weaknesses can be seen in multiple areas, such as its weak operating cash flow, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on OXF go as follows:

  • Net operating cash flow has declined marginally to $4.78 million or 8.44% when compared to the same quarter last year. In conjunction, when comparing current results to the industry average, OXFORD RESOURCE PARTNERS LP has marginally lower results.
  • The gross profit margin for OXFORD RESOURCE PARTNERS LP is rather low; currently it is at 18.17%. Regardless of OXF's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, OXF's net profit margin of -3.53% significantly underperformed when compared to the industry average.
  • OXF's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 56.13%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.
  • OXFORD RESOURCE PARTNERS LP has improved earnings per share by 47.6% 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 year. However, we anticipate underperformance relative to this pattern in the coming year. During the past fiscal year, OXFORD RESOURCE PARTNERS LP continued to lose money by earning -$1.07 versus -$1.27 in the prior year. For the next year, the market is expecting a contraction of 7.0% in earnings (-$1.15 versus -$1.07).
  • OXF, with its decline in revenue, slightly underperformed the industry average of 3.1%. Since the same quarter one year prior, revenues slightly dropped by 5.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

You can view the full analysis from the report here: Oxford Resource Partners 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.

At the close, Atlatsa Resources ( ATL) was down $0.01 (4.2%) to $0.29 on heavy volume. Throughout the day, 85,988 shares of Atlatsa Resources exchanged hands as compared to its average daily volume of 45,500 shares. The stock ranged in price between $0.27-$0.30 after having opened the day at $0.30 as compared to the previous trading day's close of $0.30.

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 energy industry. Shares are down 47.7% year-to-date as of the close of trading on Wednesday. Currently there is 1 analyst who rates Atlatsa Resources a buy, no analysts rate it a sell, and none rate it a hold.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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.

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.

Sonde Resources ( SOQ) was another company that pushed the Basic Materials sector lower today. Sonde Resources was down $0.02 (13.3%) to $0.13 on light volume. Throughout the day, 9,635 shares of Sonde Resources exchanged hands as compared to its average daily volume of 36,100 shares. The stock ranged in price between $0.13-$0.14 after having opened the day at $0.14 as compared to the previous trading day's close of $0.15.

Sonde Resources has a market cap of $7.8 million and is part of the energy industry. Shares are down 78.3% year-to-date as of the close of trading on Wednesday.

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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