NEW YORK (TheStreet) -- Shares of General Employment Enterprises (JOB) - Get GEE Group Inc. Report continue to gain, up 14.4% to $1.43 today on heavy trading volume, after the provider of specialty staffing services announced earlier this month that it would acquire Scribe Solutions, Inc.
General Employment Enterprises stock is up over 590% since the acquisition announcement of the healthcare staffing firm. The transaction is expected to close during the first quarter of 2015.
Under terms of the agreement, Scribe was valued between $6.4 and $7.9 million, as determined by an independent appraisal firm, the company said.
Exclusive Report:Jim Cramer's Best Stocks for 2015
Separately, General Employment Enterprises' major shareholder Aracle Spf I, Llc sold 461,957 shares of the stock on the open market in a transaction last week.
About 1.86 million shares of General Employment Enterprises changed hands by 12:49 p.m. in New York, compared to average of 374,573 shares.
TheStreet Ratings team rates GENERAL EMPLOY ENTERPRISES as a Sell with a ratings score of D-. TheStreet Ratings Team has this to say about their recommendation:
"We rate GENERAL EMPLOY ENTERPRISES (JOB) a SELL. This is driven by a few notable weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. Among the areas we feel are negative, one of the most important has been very high debt management risk by most measures."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The debt-to-equity ratio of 1.39 is relatively high when compared with the industry average, suggesting a need for better debt level management. To add to this, JOB has a quick ratio of 0.66, this demonstrates the lack of ability of the company to cover short-term liquidity needs.
- Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Professional Services industry and the overall market, GENERAL EMPLOY ENTERPRISES's return on equity significantly trails that of both the industry average and the S&P 500.
- JOB, with its decline in revenue, underperformed when compared the industry average of 5.8%. Since the same quarter one year prior, revenues fell by 16.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
- 44.91% is the gross profit margin for GENERAL EMPLOY ENTERPRISES which we consider to be strong. 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 2.46% trails the industry average.
- This stock has increased by 471.42% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the future course of this stock, we feel that the risks involved in investing in JOB do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
- You can view the full analysis from the report here: JOB Ratings Report