Services Sector's Featured Straggler Of The Day: MSC Industrial Direct Co. Inc. (MSM)

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.

MSC Industrial Direct ( MSM) pushed the Services sector lower today making it today's featured Services laggard. The sector as a whole closed the day up 1.6%. By the end of trading, MSC Industrial Direct fell $3.29 (-4%) to $79.89 on heavy volume. Throughout the day, 2.1 million shares of MSC Industrial Direct exchanged hands as compared to its average daily volume of 349,400 shares. The stock ranged in price between $77.39-$80.88 after having opened the day at $80.41 as compared to the previous trading day's close of $83.18. Other companies within the Services sector that declined today were: Titan Machinery ( TITN), down 14%, ENGlobal Corporation ( ENG), down 11.9%, Newlead Holdings ( NEWL), down 11.7%, and China Jo-Jo Drugstores ( CJJD), down 10.7%.
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MSC Industrial Direct Co., Inc., together with its subsidiaries, operates as a direct marketer and distributor of metalworking and maintenance, repair, and operations (MRO) products to industrial customers in the United States. MSC Industrial Direct has a market cap of $4 billion and is part of the wholesale industry. The company has a P/E ratio of 20, above the S&P 500 P/E ratio of 17.7. Shares are up 10.3% year to date as of the close of trading on Tuesday. Currently there are five analysts that rate MSC Industrial Direct a buy, no analysts rate it a sell, and seven rate it a hold.

TheStreet Ratings rates MSC Industrial Direct as a buy. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, increase in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

On the positive front, Era Group ( ERA), up 17.9%, Chanticleer Holdings ( HOTR), up 14.9%, Pizza Inn Holdings ( PZZI), up 14.7%, and Mecox Lane ( MCOX), up 13.2%, were all gainers within the services sector with Time Warner ( TWX) 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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