3 Stocks Pushing The Wholesale Industry 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 Wholesale industry as a whole closed the day down 0.8% versus the S&P 500, which was down 1.9%. Laggards within the Wholesale industry included Coast Distribution System ( CRV), down 1.6%, Armco Metals Holdings ( AMCO), down 9.8%, NL Industries ( NL), down 4.2%, Wayside Technology Group ( WSTG), down 1.8% and Speed Commerce ( SPDC), down 4.4%.

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

Speed Commerce ( SPDC) is one of the companies that pushed the Wholesale industry lower today. Speed Commerce was down $0.13 (4.4%) to $2.81 on average volume. Throughout the day, 165,698 shares of Speed Commerce exchanged hands as compared to its average daily volume of 178,700 shares. The stock ranged in price between $2.77-$2.93 after having opened the day at $2.91 as compared to the previous trading day's close of $2.94.

Speed Commerce has a market cap of $203.6 million and is part of the services sector. Shares are down 4.8% year-to-date as of the close of trading on Friday. Currently there are 2 analysts who rate Speed Commerce a buy, no analysts rate it a sell, and 1 rates it a hold.

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At the close, Wayside Technology Group ( WSTG) was down $0.31 (1.8%) to $17.36 on light volume. Throughout the day, 7,325 shares of Wayside Technology Group exchanged hands as compared to its average daily volume of 10,200 shares. The stock ranged in price between $17.19-$17.74 after having opened the day at $17.68 as compared to the previous trading day's close of $17.67.

Wayside Technology Group, Inc. operates as an information technology channel company in the United States and Canada. The company resells computer software and hardware developed by others, as well as provides technical services to customers primarily in the United States and Canada. Wayside Technology Group has a market cap of $84.4 million and is part of the services sector. Shares are up 2.7% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates Wayside Technology Group as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, attractive valuation levels and increase in net income. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from TheStreet Ratings analysis on WSTG go as follows:

  • The revenue growth came in higher than the industry average of 2.6%. Since the same quarter one year prior, revenues rose by 28.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displaying stagnant earnings per share.
  • WSTG 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 the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.48, which illustrates the ability to avoid short-term cash problems.
  • Compared to its closing price of one year ago, WSTG's share price has jumped by 29.29%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, WSTG should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • WAYSIDE TECHNOLOGY GROUP INC reported flat earnings per share in the most recent quarter. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, WAYSIDE TECHNOLOGY GROUP INC increased its bottom line by earning $1.40 versus $1.18 in the prior year.

You can view the full analysis from the report here: Wayside Technology Group Ratings Report

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NL Industries ( NL) was another company that pushed the Wholesale industry lower today. NL Industries was down $0.36 (4.2%) to $8.28 on light volume. Throughout the day, 6,069 shares of NL Industries exchanged hands as compared to its average daily volume of 16,200 shares. The stock ranged in price between $8.28-$8.73 after having opened the day at $8.73 as compared to the previous trading day's close of $8.65.

NL Industries, Inc., through its subsidiary, CompX International Inc., operates in the component products industry in the United States and internationally. NL Industries has a market cap of $418.7 million and is part of the services sector. Shares are up 0.6% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate NL Industries a buy, 1 analyst rates it a sell, and none rate it a hold.

TheStreet Ratings rates NL Industries as a sell. The company's weaknesses can be seen in multiple areas, such as its poor profit margins and generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on NL go as follows:

  • The gross profit margin for NL INDUSTRIES is currently lower than what is desirable, coming in at 34.22%. It has decreased from the same quarter the previous year. Despite the weak results of the gross profit margin, the net profit margin of 52.46% has significantly outperformed against the industry average.
  • NL has underperformed the S&P 500 Index, declining 15.43% 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 return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Commercial Services & Supplies industry and the overall market, NL INDUSTRIES's return on equity significantly trails that of both the industry average and the S&P 500.
  • NL INDUSTRIES reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, NL INDUSTRIES swung to a loss, reporting -$1.13 versus $1.16 in the prior year. This year, the market expects an improvement in earnings ($0.55 versus -$1.13).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Services & Supplies industry. The net income increased by 333.8% when compared to the same quarter one year prior, rising from -$5.94 million to $13.89 million.

You can view the full analysis from the report here: NL Industries Ratings Report

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