St Jude Medical Inc. (STJ): Today's Featured Health 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.

St Jude Medical ( STJ) pushed the Health Services industry lower today making it today's featured Health Services laggard. The industry as a whole closed the day down 0.1%. By the end of trading, St Jude Medical fell 73 cents (-1.7%) to $41.21 on average volume. Throughout the day, 3.1 million shares of St Jude Medical exchanged hands as compared to its average daily volume of 3.2 million shares. The stock ranged in price between $40.68-$41.37 after having opened the day at $41.19 as compared to the previous trading day's close of $41.94. Other companies within the Health Services industry that declined today were: BSD Medical Corporation ( BSDM), down 29.1%, Escalon Medical Corporation ( ESMC), down 12%, Spherix ( SPEX), down 6.6%, and Vision-Sciences Inc (DE ( VSCI), down 6.5%.
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St. Jude Medical, Inc. develops, manufactures, and distributes cardiovascular and implantable neurostimulation medical devices worldwide. It operates in two divisions, Cardiovascular and Ablation Technologies, and Implantable Electronic Systems. St Jude Medical has a market cap of $11.87 billion and is part of the health care sector. The company has a P/E ratio of 17.5, below the S&P 500 P/E ratio of 17.7. Shares are up 16% year to date as of the close of trading on Monday. Currently there are 11 analysts that rate St Jude Medical a buy, no analysts rate it a sell, and 12 rate it a hold.

TheStreet Ratings rates St Jude Medical as a buy. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, good cash flow from operations, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

On the positive front, Unilife Corporation ( UNIS), up 15.6%, Staar Surgical ( STAA), up 10.9%, Biolase ( BIOL), up 8.9%, and Kips Bay Medical ( KIPS), up 8.2%, were all gainers within the health services industry with WellPoint ( WLP) being today's featured health services industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the health services industry could consider Health Care Select Sector SPDR ( XLV) while those bearish on the health services industry could consider ProShares Ultra Short Health Care ( RXD).

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