3 Stocks Pushing The Industrial 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.

The Industrial industry as a whole closed the day down 1.1% versus the S&P 500, which was down 1.3%. Laggards within the Industrial industry included Euro Tech Holdings ( CLWT), down 5.2%, Intelligent Systems ( INS), down 3.6%, LightPath Technologies ( LPTH), down 1.7%, Taylor Devices ( TAYD), down 2.5% and Ultralife Batteries ( ULBI), down 5.3%.

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

Parker Hannifin ( PH) is one of the companies that pushed the Industrial industry lower today. Parker Hannifin was down $3.77 (3.1%) to $118.45 on average volume. Throughout the day, 1,604,355 shares of Parker Hannifin exchanged hands as compared to its average daily volume of 1,323,600 shares. The stock ranged in price between $117.92-$121.21 after having opened the day at $120.75 as compared to the previous trading day's close of $122.22.

Parker-Hannifin Corporation manufactures and sells motion and control technologies and systems for various mobile, industrial, and aerospace markets worldwide. It operates through two segments, Diversified Industrial and Aerospace Systems. Parker Hannifin has a market cap of $17.3 billion and is part of the industrial goods sector. Shares are down 5.2% year-to-date as of the close of trading on Thursday. Currently there are 6 analysts who rate Parker Hannifin a buy, 1 analyst rates it a sell, and 6 rate it a hold.

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TheStreet Ratings rates Parker Hannifin 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, growth in earnings per share, reasonable valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from TheStreet Ratings analysis on PH go as follows:

  • PH's revenue growth has slightly outpaced the industry average of 1.4%. Since the same quarter one year prior, revenues slightly increased by 0.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.52, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, PH has a quick ratio of 1.69, which demonstrates the ability of the company to cover short-term liquidity needs.
  • PARKER-HANNIFIN CORP has improved earnings per share by 8.4% 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. We feel that this trend should continue. During the past fiscal year, PARKER-HANNIFIN CORP increased its bottom line by earning $6.85 versus $6.22 in the prior year. This year, the market expects an improvement in earnings ($8.10 versus $6.85).
  • Net operating cash flow has slightly increased to $277.62 million or 7.84% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -12.41%.

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

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At the close, Ultralife Batteries ( ULBI) was down $0.21 (5.3%) to $3.74 on light volume. Throughout the day, 3,934 shares of Ultralife Batteries exchanged hands as compared to its average daily volume of 10,600 shares. The stock ranged in price between $3.67-$3.89 after having opened the day at $3.85 as compared to the previous trading day's close of $3.95.

Ultralife Corporation offers power and communications solutions in the United States and internationally. It operates through two segments, Battery & Energy Products and Communications Systems. Ultralife Batteries has a market cap of $63.9 million and is part of the industrial goods sector. Shares are up 26.2% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Ultralife Batteries 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 growth in earnings per share. 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 ULBI 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 Electrical Equipment industry. The net income increased by 1136.2% when compared to the same quarter one year prior, rising from $0.07 million to $0.85 million.
  • ULBI 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 2.61, which clearly demonstrates the ability to cover short-term cash needs.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 9.7%. Since the same quarter one year prior, revenues slightly dropped by 1.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • In its most recent trading session, ULBI has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. 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 Electrical Equipment industry and the overall market, ULTRALIFE CORP'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: Ultralife Batteries 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.

LightPath Technologies ( LPTH) was another company that pushed the Industrial industry lower today. LightPath Technologies was down $0.02 (1.7%) to $0.97 on light volume. Throughout the day, 6,447 shares of LightPath Technologies exchanged hands as compared to its average daily volume of 22,300 shares. The stock ranged in price between $0.97-$1.00 after having opened the day at $0.98 as compared to the previous trading day's close of $0.99.

LightPath Technologies, Inc. designs, develops, manufactures, and distributes optical components and assemblies. LightPath Technologies has a market cap of $15.4 million and is part of the industrial goods sector. Shares are up 8.8% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates LightPath Technologies a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates LightPath Technologies as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on LPTH go as follows:

  • 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, LIGHTPATH TECHNOLOGIES INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • LPTH'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 31.25%, 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.
  • LIGHTPATH TECHNOLOGIES INC 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. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, LIGHTPATH TECHNOLOGIES INC swung to a loss, reporting -$0.02 versus $0.02 in the prior year. This year, the market expects earnings to be in line with last year (-$0.02 versus -$0.02).
  • 42.23% is the gross profit margin for LIGHTPATH TECHNOLOGIES INC which we consider to be strong. Regardless of LPTH's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 4.20% trails the industry average.
  • Net operating cash flow has significantly increased by 55.22% to -$0.21 million when compared to the same quarter last year. In addition, LIGHTPATH TECHNOLOGIES INC has also vastly surpassed the industry average cash flow growth rate of -6.06%.

You can view the full analysis from the report here: LightPath Technologies 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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