3 Stocks Pushing The Banking 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 Banking industry as a whole closed the day down 0.7% versus the S&P 500, which was down 0.5%. Laggards within the Banking industry included Carolina Trust Bank ( CART), down 1.7%, Village Bank and Trust Financial ( VBFC), down 9.5%, Broadway Financial ( BYFC), down 4.0%, Fauquier Bankshares ( FBSS), down 2.2% and Citizens ( CIZN), down 1.9%.

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

Royal Bank of Scotland Group (The ( RBS) is one of the companies that pushed the Banking industry lower today. Royal Bank of Scotland Group (The was down $0.29 (2.5%) to $11.36 on light volume. Throughout the day, 253,054 shares of Royal Bank of Scotland Group (The exchanged hands as compared to its average daily volume of 476,000 shares. The stock ranged in price between $11.30-$11.42 after having opened the day at $11.37 as compared to the previous trading day's close of $11.65.

The Royal Bank of Scotland Group plc, through its subsidiaries, provides banking and financial products and services to personal, commercial, corporate, and institutional customers worldwide. Royal Bank of Scotland Group (The has a market cap of $65.7 billion and is part of the financial sector. Shares are down 3.8% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates Royal Bank of Scotland Group (The a buy, 1 analyst rates it a sell, and none rate it a hold.

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TheStreet Ratings rates Royal Bank of Scotland Group (The as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, expanding profit margins and growth in earnings per share. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and a generally disappointing performance in the stock itself.

Highlights from TheStreet Ratings analysis on RBS 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 Commercial Banks industry. The net income increased by 230.4% when compared to the same quarter one year prior, rising from -$1,105.12 million to $1,441.43 million.
  • The gross profit margin for ROYAL BANK OF SCOTLAND GROUP is currently very high, coming in at 99.10%. It has increased significantly from the same period last year. Regardless of the strong results of the gross profit margin, the net profit margin of 19.08% trails the industry average.
  • ROYAL BANK OF SCOTLAND GROUP 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, ROYAL BANK OF SCOTLAND GROUP reported poor results of -$2.68 versus -$1.72 in the prior year. This year, the market expects an improvement in earnings ($48.56 versus -$2.68).
  • RBS has underperformed the S&P 500 Index, declining 12.10% 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.
  • 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 Commercial Banks industry and the overall market, ROYAL BANK OF SCOTLAND GROUP'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: Royal Bank of Scotland Group (The Ratings Report

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At the close, Citizens ( CIZN) was down $0.37 (1.9%) to $18.85 on heavy volume. Throughout the day, 2,213 shares of Citizens exchanged hands as compared to its average daily volume of 1,100 shares. The stock ranged in price between $18.76-$18.86 after having opened the day at $18.76 as compared to the previous trading day's close of $19.22.

Citizens Holding Company operates as the bank holding company for The Citizens Bank of Philadelphia that provides commercial and personal banking products and services in Mississippi, the United States. Citizens has a market cap of $93.7 million and is part of the financial sector. Shares are down 1.1% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Citizens as a buy. The company's strengths can be seen in multiple areas, such as its good cash flow from operations, expanding profit margins, increase in stock price during the past year, notable return on equity and attractive valuation levels. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from TheStreet Ratings analysis on CIZN go as follows:

  • Net operating cash flow has increased to $3.40 million or 48.57% when compared to the same quarter last year. In addition, CITIZENS HOLDING CO has also vastly surpassed the industry average cash flow growth rate of -80.11%.
  • The gross profit margin for CITIZENS HOLDING CO is currently very high, coming in at 90.25%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 19.19% trails the industry average.
  • After a year of stock price fluctuations, the net result is that CIZN's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • 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 Banks industry and the overall market on the basis of return on equity, CITIZENS HOLDING CO has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.
  • CITIZENS HOLDING CO' earnings per share from the most recent quarter came in slightly below the year earlier 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, CITIZENS HOLDING CO increased its bottom line by earning $1.47 versus $1.39 in the prior year.

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

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Fauquier Bankshares ( FBSS) was another company that pushed the Banking industry lower today. Fauquier Bankshares was down $0.45 (2.2%) to $19.55 on light volume. Throughout the day, 455 shares of Fauquier Bankshares exchanged hands as compared to its average daily volume of 900 shares. The stock ranged in price between $19.55-$20.00 after having opened the day at $20.00 as compared to the previous trading day's close of $20.00.

Fauquier Bankshares, Inc. operates as a bank holding company for The Fauquier Bank that provides various consumer and commercial banking services to individuals, businesses, and industries in Virginia. Fauquier Bankshares has a market cap of $76.9 million and is part of the financial sector. Shares are up 8.4% year-to-date as of the close of trading on Thursday.

TheStreet Ratings rates Fauquier Bankshares as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth, compelling growth in net income, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

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Highlights from TheStreet Ratings analysis on FBSS go as follows:

  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 43.67% over the past year, a rise that has exceeded that of the S&P 500 Index. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • FAUQUIER BANKSHARES INC has improved earnings per share by 22.6% 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 two years. During the past fiscal year, FAUQUIER BANKSHARES INC increased its bottom line by earning $1.16 versus $0.56 in the prior year.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Commercial Banks industry average. The net income increased by 22.2% when compared to the same quarter one year prior, going from $1.16 million to $1.42 million.
  • The gross profit margin for FAUQUIER BANKSHARES INC is currently very high, coming in at 91.48%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 19.07% trails the industry average.
  • 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 Banks industry and the overall market on the basis of return on equity, FAUQUIER BANKSHARES INC has outperformed in comparison with the industry average, but has underperformed when compared to that of the S&P 500.

You can view the full analysis from the report here: Fauquier Bankshares 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.

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