News Corporation (NWSA): Today's Featured 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.

News Corporation ( NWSA) pushed the Services sector lower today making it today's featured Services laggard. The sector as a whole closed the day down 0.2%. By the end of trading, News Corporation fell 30 cents (-1.1%) to $26.20 on light volume. Throughout the day, 7.2 million shares of News Corporation exchanged hands as compared to its average daily volume of 15.9 million shares. The stock ranged in price between $26.09-$26.46 after having opened the day at $26.34 as compared to the previous trading day's close of $26.50. Other companies within the Services sector that declined today were: ITT Educational Services ( ESI), down 19.3%, PokerTek ( PTEK), down 16.9%, Noah Education Holdings ( NED), down 13.1%, and DLH Holdings ( DLHC), down 12.5%.
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News Corporation operates as a diversified media company worldwide. News Corporation has a market cap of $40.6 billion and is part of the media industry. The company has a P/E ratio of 23.2, above the S&P 500 P/E ratio of 17.7. Shares are up 2.9% year to date as of the close of trading on Friday. Currently there are 16 analysts that rate News Corporation a buy, no analysts rate it a sell, and four rate it a hold.

TheStreet Ratings rates News Corporation as a buy. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, expanding profit margins and good cash flow from operations. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

On the positive front, FreeSeas ( FREE), up 126.4%, Radio One Inc. Class D ( ROIAK), up 18.1%, Paragon Shipping ( PRGN), up 18%, and Radio One ( ROIA), up 13.6%, were all gainers within the services sector with Priceline.com ( PCLN) being today's featured services sector leader.

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

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