3 Stocks Pushing The Aerospace/Defense 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 Aerospace/Defense industry as a whole closed the day down 0.5% versus the S&P 500, which was down 0.3%. Laggards within the Aerospace/Defense industry included Rada Electronics Industries ( RADA), down 9.8%, LMI Aerospace ( LMIA), down 1.7%, Ducommun ( DCO), down 2.2% and Taser International ( TASR), down 7.7%.

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

Taser International ( TASR) is one of the companies that pushed the Aerospace/Defense industry lower today. Taser International was down $2.09 (7.7%) to $25.13 on heavy volume. Throughout the day, 3,772,543 shares of Taser International exchanged hands as compared to its average daily volume of 2,329,100 shares. The stock ranged in price between $25.10-$27.08 after having opened the day at $27.03 as compared to the previous trading day's close of $27.22.

TASER International, Inc. develops, manufactures, and sells conducted electrical weapons (CEWs) worldwide. It operates through two segments, TASER Weapons and AXON. Taser International has a market cap of $1.5 billion and is part of the industrial goods sector. Shares are up 2.8% year-to-date as of the close of trading on Friday. Currently there are 2 analysts who rate Taser International a buy, 1 analyst rates it a sell, and 3 rate it a hold.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreet Ratings rates Taser International as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. We feel its strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.

Highlights from TheStreet Ratings analysis on TASR go as follows:

  • The revenue growth came in higher than the industry average of 4.3%. Since the same quarter one year prior, revenues rose by 25.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • TASR's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.55, which clearly demonstrates the ability to cover short-term cash needs.
  • TASER INTERNATIONAL 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. We feel that this trend should continue. During the past fiscal year, TASER INTERNATIONAL INC increased its bottom line by earning $0.36 versus $0.34 in the prior year. This year, the market expects an improvement in earnings ($0.49 versus $0.36).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Aerospace & Defense industry. The net income increased by 57.1% when compared to the same quarter one year prior, rising from $3.88 million to $6.10 million.
  • The gross profit margin for TASER INTERNATIONAL INC is rather high; currently it is at 65.77%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 13.06% is above that of the industry average.

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

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

At the close, Ducommun ( DCO) was down $0.54 (2.2%) to $23.41 on average volume. Throughout the day, 62,225 shares of Ducommun exchanged hands as compared to its average daily volume of 79,900 shares. The stock ranged in price between $22.94-$24.31 after having opened the day at $23.90 as compared to the previous trading day's close of $23.95.

Ducommun Incorporated provides engineering and manufacturing products and services primarily to the aerospace, defense, industrial, natural resources, medical, and other industries. The company operates in two segments, Ducommun LaBarge Technologies (DLT) and Ducommun Aerostructures (DAS). Ducommun has a market cap of $265.4 million and is part of the industrial goods sector. Shares are down 5.3% year-to-date as of the close of trading on Friday. Currently there are 2 analysts who rate Ducommun a buy, no analysts rate it a sell, and 3 rate it a hold.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreet Ratings rates Ducommun as a hold. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, unimpressive growth in net income and disappointing return on equity.

Highlights from TheStreet Ratings analysis on DCO go as follows:

  • Net operating cash flow has significantly increased by 135.87% to $3.49 million when compared to the same quarter last year. In addition, DUCOMMUN INC has also vastly surpassed the industry average cash flow growth rate of 22.53%.
  • DCO, with its decline in revenue, slightly underperformed the industry average of 4.3%. Since the same quarter one year prior, revenues slightly dropped by 3.8%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • 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. In comparison to the other companies in the Aerospace & Defense industry and the overall market, DUCOMMUN INC's return on equity is significantly below that of the industry average and is below that of the S&P 500.
  • The gross profit margin for DUCOMMUN INC is rather low; currently it is at 19.47%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -1.14% trails that of the industry average.

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

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

LMI Aerospace ( LMIA) was another company that pushed the Aerospace/Defense industry lower today. LMI Aerospace was down $0.17 (1.7%) to $9.93 on light volume. Throughout the day, 13,361 shares of LMI Aerospace exchanged hands as compared to its average daily volume of 65,000 shares. The stock ranged in price between $9.93-$10.08 after having opened the day at $10.01 as compared to the previous trading day's close of $10.10.

LMI Aerospace Inc. provides structural assemblies, kits and components, and design engineering services to the aerospace and defense markets in the United States. LMI Aerospace has a market cap of $132.3 million and is part of the industrial goods sector. Shares are down 28.4% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate LMI Aerospace a buy, no analysts rate it a sell, and 2 rate it a hold.

TheStreet Ratings rates LMI Aerospace as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, poor profit margins, weak operating cash flow, generally high debt management risk and generally disappointing historical performance in the stock itself.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

Highlights from TheStreet Ratings analysis on LMIA go as follows:

  • 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 Aerospace & Defense industry. The net income has significantly decreased by 231.4% when compared to the same quarter one year ago, falling from -$0.44 million to -$1.47 million.
  • The gross profit margin for LMI AEROSPACE INC is rather low; currently it is at 23.91%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -1.58% trails that of the industry average.
  • Net operating cash flow has significantly decreased to -$9.28 million or 192.62% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The debt-to-equity ratio is very high at 2.38 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, LMIA's quick ratio is somewhat strong at 1.37, demonstrating the ability to handle short-term liquidity needs.
  • The share price of LMI AEROSPACE INC has not done very well: it is down 23.62% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. 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.

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

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

More from Markets

OPEC, Bank Stress Tests, Disney and Tesla - 5 Things You Must Know

OPEC, Bank Stress Tests, Disney and Tesla - 5 Things You Must Know

Big Banks Pass the Stress Tests and 4 Other Stories to Watch Friday Morning

Big Banks Pass the Stress Tests and 4 Other Stories to Watch Friday Morning

OPEC Debating 1 Million Barrel Oil Market Boost as Iran Signals Support

OPEC Debating 1 Million Barrel Oil Market Boost as Iran Signals Support

Dow Set to Snap 8-Day Losing Streak as Stocks Recover, But Trade War Lingers

Dow Set to Snap 8-Day Losing Streak as Stocks Recover, But Trade War Lingers

Foxconn Chairman Terry Gou: US and China Are Waging a Global 'Tech War'

Foxconn Chairman Terry Gou: US and China Are Waging a Global 'Tech War'