3 Stocks Pushing The Basic Materials Sector Lower

The Basic Materials sector as a whole closed the day down 2.5% versus the S&P 500, which was down 1.7%. Laggards within the Basic Materials sector included Alderon Iron Ore ( AXX), down 3.4%, Timberline Resources ( TLR), down 5.3%, Houston American Energy ( HUSA), down 2.6%, Entree Gold ( EGI), down 16.1% and Escalera Resources ( ESCR), down 26.4%.

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

Houston American Energy ( HUSA) is one of the companies that pushed the Basic Materials sector lower today. Houston American Energy was down $0.00 (2.6%) to $0.18 on average volume. Throughout the day, 45,412 shares of Houston American Energy exchanged hands as compared to its average daily volume of 49,200 shares. The stock ranged in price between $0.18-$0.20 after having opened the day at $0.18 as compared to the previous trading day's close of $0.19.

Houston American Energy Corp., an independent energy company, acquires, explores for, develops, and produces natural gas, crude oil, and condensate from properties located principally in the Gulf Coast area of the United States and South America. Houston American Energy has a market cap of $10.4 million and is part of the energy industry. Shares are up 18.4% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Houston American Energy as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, feeble growth in its earnings per share and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on HUSA 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 Oil, Gas & Consumable Fuels industry. The net income has significantly decreased by 121.9% when compared to the same quarter one year ago, falling from -$0.54 million to -$1.19 million.
  • 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 Oil, Gas & Consumable Fuels industry and the overall market, HOUSTON AMERN ENERGY CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • HOUSTON AMERN ENERGY CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. Stable Earnings per share over the past year indicate the company has sound management over its earnings and share float. During the past fiscal year, HOUSTON AMERN ENERGY CORP reported poor results of -$0.07 versus -$0.06 in the prior year.
  • The share price of HOUSTON AMERN ENERGY CORP has not done very well: it is down 13.05% 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.
  • Despite the weak revenue results, HUSA has significantly outperformed against the industry average of 34.4%. Since the same quarter one year prior, revenues slightly dropped by 3.8%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

You can view the full analysis from the report here: Houston American Energy Ratings Report

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At the close, Timberline Resources ( TLR) was down $0.02 (5.3%) to $0.36 on heavy volume. Throughout the day, 23,087 shares of Timberline Resources exchanged hands as compared to its average daily volume of 13,400 shares. The stock ranged in price between $0.36-$0.40 after having opened the day at $0.39 as compared to the previous trading day's close of $0.38.

Timberline Resources has a market cap of $5.0 million and is part of the energy industry. Shares are down 35.3% year-to-date as of the close of trading on Thursday.

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Alderon Iron Ore ( AXX) was another company that pushed the Basic Materials sector lower today. Alderon Iron Ore was down $0.00 (3.4%) to $0.14 on average volume. Throughout the day, 10,600 shares of Alderon Iron Ore exchanged hands as compared to its average daily volume of 8,000 shares. The stock ranged in price between $0.13-$0.14 after having opened the day at $0.14 as compared to the previous trading day's close of $0.15.

Alderon Iron Ore has a market cap of $19.8 million and is part of the energy industry. Shares are down 55.9% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Alderon Iron Ore a buy, 1 analyst rates it a sell, and none rate it a hold.

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