3 Stocks Boosting The Consumer Non-Durables Industry Higher

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.

Two out of the three major indices traded up today One out of the three major indices traded up today The three major indices are trading lower today with the Dow Jones Industrial Average ( ^DJI) trading down 9.47 points (-0.1%) at 17,801 as of Monday, Nov. 24, 2014, 3:25 PM ET. The NYSE advances/declines ratio sits at 1,732 issues advancing vs. 1,284 declining with 172 unchanged.

The Consumer Non-Durables industry as a whole closed the day up 0.8% versus the S&P 500, which was up 0.2%. Top gainers within the Consumer Non-Durables industry included CTI Industries ( CTIB), up 2.4%, DS Healthcare Group ( DSKX), up 13.7%, Forward Industries ( FORD), up 2.9%, CCA Industries ( CAW), up 2.4% and Deswell Industries ( DSWL), up 3.7%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the industry higher today:

Deswell Industries ( DSWL) is one of the companies that pushed the Consumer Non-Durables industry higher today. Deswell Industries was up $0.08 (3.7%) to $2.22 on light volume. Throughout the day, 9,619 shares of Deswell Industries exchanged hands as compared to its average daily volume of 15,900 shares. The stock ranged in a price between $2.15-$2.22 after having opened the day at $2.22 as compared to the previous trading day's close of $2.14.

Deswell Industries, Inc. manufactures and sells injection-molded plastic parts and components, electronic products, assembling, and metallic parts for original equipment manufacturers and contract manufacturers. Deswell Industries has a market cap of $35.5 million and is part of the services sector. Shares are down 1.3% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate Deswell Industries a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Deswell Industries as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity, a generally disappointing performance in the stock itself and poor profit margins.

Highlights from TheStreet Ratings analysis on DSWL go as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Electronic Equipment, Instruments & Components industry. The net income increased by 100.8% when compared to the same quarter one year prior, rising from -$1.72 million to $0.01 million.
  • DSWL 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 4.23, which clearly demonstrates the ability to cover short-term cash needs.
  • DSWL, with its decline in revenue, underperformed when compared the industry average of 2.2%. Since the same quarter one year prior, revenues fell by 19.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • DSWL has underperformed the S&P 500 Index, declining 9.43% 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 company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, DESWELL INDUSTRIES 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: Deswell Industries Ratings Report

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At the close, DS Healthcare Group ( DSKX) was up $0.09 (13.7%) to $0.76 on heavy volume. Throughout the day, 75,497 shares of DS Healthcare Group exchanged hands as compared to its average daily volume of 26,200 shares. The stock ranged in a price between $0.70-$0.78 after having opened the day at $0.73 as compared to the previous trading day's close of $0.67.

DS Healthcare Group has a market cap of $12.1 million and is part of the services sector. Shares are down 69.4% year-to-date as of the close of trading on Friday.

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

CTI Industries ( CTIB) was another company that pushed the Consumer Non-Durables industry higher today. CTI Industries was up $0.09 (2.4%) to $3.90 on average volume. Throughout the day, 2,500 shares of CTI Industries exchanged hands as compared to its average daily volume of 1,800 shares. The stock ranged in a price between $3.90-$3.99 after having opened the day at $3.90 as compared to the previous trading day's close of $3.81.

CTI Industries Corporation develops, manufactures, and supplies flexible film products for novelty, packaging and container, and custom product applications worldwide. CTI Industries has a market cap of $12.6 million and is part of the services sector. Shares are down 34.8% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate CTI Industries a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates CTI Industries as a sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself, unimpressive growth in net income, generally high debt management risk, weak operating cash flow and poor profit margins.

Highlights from TheStreet Ratings analysis on CTIB go as follows:

  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 31.36%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 100.00% compared to the year-earlier quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
  • 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 Household Durables industry. The net income has significantly decreased by 116.1% when compared to the same quarter one year ago, falling from -$0.06 million to -$0.12 million.
  • The debt-to-equity ratio of 1.47 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, CTIB has a quick ratio of 0.55, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
  • Net operating cash flow has significantly decreased to -$2.01 million or 231.14% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The gross profit margin for CTI INDUSTRIES CORP is currently lower than what is desirable, coming in at 27.02%. Regardless of CTIB'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 -0.91% trails the industry average.

You can view the full analysis from the report here: CTI Industries 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.

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.

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