3 Stocks Pushing The Transportation Industry Lower

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The Transportation industry as a whole closed the day down 1.7% versus the S&P 500, which was down 1.7%. Laggards within the Transportation industry included PHI ( PHII), down 5.6%, Paragon Shipping ( PRGN), down 6.7%, FreeSeas ( FREE), down 2.6%, Overseas Shipholding Group ( OSGB), down 5.4% and Rand Logistics ( RLOG), down 4.7%.

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

FreeSeas ( FREE) is one of the companies that pushed the Transportation industry lower today. FreeSeas was down $0.00 (2.6%) to $0.08 on average volume. Throughout the day, 2,371,149 shares of FreeSeas exchanged hands as compared to its average daily volume of 2,378,500 shares. The stock ranged in price between $0.08-$0.08 after having opened the day at $0.08 as compared to the previous trading day's close of $0.08.

FreeSeas Inc., through its subsidiaries, provides drybulk shipping services. Its vessels carry various drybulk commodities, such as iron ore, grain, and coal, as well as bauxite, phosphate, fertilizers, steel products, cement, sugar, and rice. FreeSeas has a market cap of $9.2 million and is part of the services sector. Shares are down 11.1% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates FreeSeas as a sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself and generally high debt management risk.

Highlights from TheStreet Ratings analysis on FREE go as follows:

  • FREE'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 96.21%, 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.
  • FREE's debt-to-equity ratio of 0.62 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.11 is very low and demonstrates very weak liquidity.
  • The revenue fell significantly faster than the industry average of 16.4%. Since the same quarter one year prior, revenues fell by 45.6%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • Compared to other companies in the Marine industry and the overall market, FREESEAS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • FREESEAS INC reported significant earnings per share improvement 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, FREESEAS INC continued to lose money by earning -$29.37 versus -$220.50 in the prior year.

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

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At the close, Paragon Shipping ( PRGN) was down $0.11 (6.7%) to $1.54 on heavy volume. Throughout the day, 193,479 shares of Paragon Shipping exchanged hands as compared to its average daily volume of 103,900 shares. The stock ranged in price between $1.48-$1.65 after having opened the day at $1.65 as compared to the previous trading day's close of $1.65.

Paragon Shipping Inc. provides shipping transportation services worldwide. It is engaged in the ocean transportation of drybulk cargoes, including commodities, such as iron ore, coal, grain, and other materials. Paragon Shipping has a market cap of $42.4 million and is part of the services sector. Shares are down 36.4% year-to-date as of the close of trading on Monday. Currently there are 2 analysts who rate Paragon Shipping a buy, no analysts rate it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Paragon Shipping as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, poor profit margins, weak operating cash flow, generally disappointing historical performance in the stock itself and generally high debt management risk.

Highlights from TheStreet Ratings analysis on PRGN go as follows:

  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Marine industry and the overall market, PARAGON SHIPPING INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for PARAGON SHIPPING INC is rather low; currently it is at 21.37%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -47.15% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$3.39 million or 1941.30% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • PRGN'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 78.50%, 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.
  • PRGN's debt-to-equity ratio of 0.86 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Even though the debt-to-equity ratio shows mixed results, the company's quick ratio of 0.20 is very low and demonstrates very weak liquidity.

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

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PHI ( PHII) was another company that pushed the Transportation industry lower today. PHI was down $1.86 (5.6%) to $31.09 on light volume. Throughout the day, 327 shares of PHI exchanged hands as compared to its average daily volume of 800 shares. The stock ranged in price between $31.09-$32.46 after having opened the day at $32.46 as compared to the previous trading day's close of $32.95.

PHI, Inc. provides helicopter transportation services to the oil and gas exploration, development, and production industry, principally in the Gulf of Mexico. The company operates in three business segments: Oil and Gas, Air Medical, and Technical Services. PHI has a market cap of $95.7 million and is part of the services sector. Shares are down 8.5% year-to-date as of the close of trading on Monday.

TheStreet Ratings rates PHI as a buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, increase in net income, revenue growth, attractive valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

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Highlights from TheStreet Ratings analysis on PHII go as follows:

  • PHI INC has improved earnings per share by 25.0% 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, PHI INC increased its bottom line by earning $3.77 versus $1.16 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 Energy Equipment & Services industry average. The net income increased by 25.2% when compared to the same quarter one year prior, rising from $13.78 million to $17.25 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 14.6%. Since the same quarter one year prior, revenues slightly increased by 7.7%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Net operating cash flow has slightly increased to $10.79 million or 3.75% when compared to the same quarter last year. Despite an increase in cash flow, PHI INC's average is still marginally south of the industry average growth rate of 3.92%.

You can view the full analysis from the report here: PHI 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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