Apollo Group Inc (APOL): Today's Featured Diversified Services Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Apollo Group ( APOL) pushed the Diversified Services industry lower today making it today's featured Diversified Services laggard. The industry as a whole closed the day up 0.2%. By the end of trading, Apollo Group fell $1.26 (-4.3%) to $27.76 on average volume. Throughout the day, 1.7 million shares of Apollo Group exchanged hands as compared to its average daily volume of 1.9 million shares. The stock ranged in price between $27.71-$29.26 after having opened the day at $29.12 as compared to the previous trading day's close of $29.02. Other companies within the Diversified Services industry that declined today were: Fortune Industries ( FFI), down 13.6%, American Learning ( ALRN), down 10.3%, Heartland Payment Systems ( HPY), down 7.8%, and Willdan Group ( WLDN), down 7.5%.
  • ACTIVE STOCK TRADERS: Get full access to Jim Cramer's thoughts for less than $3/week - sometimes before he says them on TV! Start with a 14-Day Free Trial.

Apollo Group, Inc., through its subsidiaries, provides online and on-campus educational programs and services at the undergraduate, master's, and doctoral levels. Apollo Group has a market cap of $3.26 billion and is part of the services sector. The company has a P/E ratio of seven, equal to the average diversified services industry P/E ratio and below the S&P 500 P/E ratio of 17.7. Shares are down 46.4% year to date as of the close of trading on Tuesday. Currently there are nine analysts that rate Apollo Group a buy, one analyst rates it a sell, and four rate it a hold.

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

On the positive front, Innovaro ( INV), up 28.6%, Daegis ( DAEG), up 25.8%, Oxygen Biotherapeutics ( OXBT), up 16.4%, and China Yida ( CNYD), up 11.1%, were all gainers within the diversified services industry with Ulta Salon Cosmetics & Fragrances ( ULTA) being today's featured diversified services industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the diversified services industry could consider iShares Dow Jones US Cons Services ( IYC) while those bearish on the diversified services industry could consider ProShares Ultra Short Consumer Sers ( SCC).

FREE from Real Money's Jim Cramer: Winners and Losers Election 2012 - Steps to take NOW so you can profit no matter who is in charge! Free download now.
null

If you liked this article you might like

5 Things You Must Know Before the Market Opens Monday

Week Ahead: Wall Street Welcomes Fourth-Quarter Earnings With the Big Banks

It's Going to Take More Than Lax Regulation to Turn Around For-Profit Education Sector

Buying Stocks With a Private Equity Mindset

Private Equity: Elevated Valuations Warrant Elevated Caution