3 Basic Materials Stocks Pushing The Sector 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 with the Dow Jones Industrial Average ( ^DJI) trading up 31 points (0.2%) at 17,848 as of Tuesday, Nov. 25, 2014, 3:25 PM ET. The NYSE advances/declines ratio sits at 1,614 issues advancing vs. 1,392 declining with 174 unchanged.

The Basic Materials sector as a whole closed the day down 0.6% versus the S&P 500, which was unchanged. Top gainers within the Basic Materials sector included Timberline Resources ( TLR), up 6.7%, Enerjex Resources ( ENRJ), up 14.7%, New Concept Energy ( GBR), up 1.7%, Ikonics ( IKNX), up 2.8% and China Gerui Advanced Materials Group ( CHOP), up 4.3%.

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

China Gerui Advanced Materials Group ( CHOP) is one of the companies that pushed the Basic Materials sector higher today. China Gerui Advanced Materials Group was up $0.09 (4.3%) to $2.20 on heavy volume. Throughout the day, 22,581 shares of China Gerui Advanced Materials Group exchanged hands as compared to its average daily volume of 14,700 shares. The stock ranged in a price between $2.13-$2.44 after having opened the day at $2.15 as compared to the previous trading day's close of $2.11.

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 $12.9 million and is part of the metals & mining industry. Shares are down 82.6% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate China Gerui Advanced Materials Group a buy, no analysts rate it a sell, and none rate it a hold.

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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, poor profit margins, weak operating cash flow and generally disappointing historical performance in the stock itself.

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 -$2.30 versus $4.50 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.
  • 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.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 80.69%, 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. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.

You can view the full analysis from the report here: China Gerui Advanced Materials Group 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, Enerjex Resources ( ENRJ) was up $0.58 (14.7%) to $4.50 on average volume. Throughout the day, 4,773 shares of Enerjex Resources exchanged hands as compared to its average daily volume of 5,000 shares. The stock ranged in a price between $4.00-$4.57 after having opened the day at $4.00 as compared to the previous trading day's close of $3.92.

Enerjex Resources has a market cap of $29.8 million and is part of the metals & mining industry. Shares are down 52.7% year-to-date as of the close of trading on Monday.

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

Timberline Resources ( TLR) was another company that pushed the Basic Materials sector higher today. Timberline Resources was up $0.04 (6.7%) to $0.69 on heavy volume. Throughout the day, 93,374 shares of Timberline Resources exchanged hands as compared to its average daily volume of 27,900 shares. The stock ranged in a price between $0.66-$0.76 after having opened the day at $0.66 as compared to the previous trading day's close of $0.65.

Timberline Resources has a market cap of $3.9 million and is part of the metals & mining industry. Shares are down 70.1% year-to-date as of the close of trading on Monday.

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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