AthenaHealth Inc. (ATHN): 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

AthenaHealth ( ATHN) pushed the Diversified Services industry lower today making it today's featured Diversified Services laggard. The industry as a whole closed the day up 1.5%. By the end of trading, AthenaHealth fell $8.33 (-8.8%) to $86.82 on heavy volume. Throughout the day, 1,748,535 shares of AthenaHealth exchanged hands as compared to its average daily volume of 334,200 shares. The stock ranged in price between $86.10-$95.90 after having opened the day at $94.80 as compared to the previous trading day's close of $95.15. Other companies within the Diversified Services industry that declined today were: DLH Holdings ( DLHC), down 8.8%, Luna Innovations ( LUNA), down 8.5%, Document Security Systems ( DSS), down 8.5% and ENGlobal Corporation ( ENG), down 7.9%.
  • EXCLUSIVE OFFER: Jim Cramer's Protege, Dave Peltier, only buys Stocks Under $10 that he thinks could potentially double. See what he's trading today with a 14-day FREE pass.

athenahealth, Inc., a business services company, provides ongoing billing, clinical-related, and other related services to medical group practices primarily in the United States. The company provides services through the athenaNet, a proprietary Internet-based practice management application. AthenaHealth has a market cap of $3.5 billion and is part of the services sector. The company has a P/E ratio of 192.0, above the S&P 500 P/E ratio of 17.7. Shares are up 31.0% year to date as of the close of trading on Thursday. Currently there are 8 analysts that rate AthenaHealth a buy, 1 analyst rates it a sell, and 9 rate it a hold.

TheStreet Ratings rates AthenaHealth as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, growth in earnings per share and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

On the positive front, comScore ( SCOR), down 19.1%, Genetic Technologies ( GENE), down 17.8%, Hill International ( HIL), down 16.7% and SmartPros ( SPRO), down 12.6% , were all gainers within the diversified services industry with Visa ( V) 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).

Exclusive Offer: Jim Cramer's 'go-to' small/mid-cap guru Bryan Ashenberg only buys stocks he thinks could return 50-100%. See his top picks for 14-days FREE.

null

More from Markets

Credit Suisse Surges After Strong Q1, Record Wealth Management Inflows

Credit Suisse Surges After Strong Q1, Record Wealth Management Inflows

Global Stocks Slide as Yield Pressure, Commodity Surge Prompts Equity Exit

Global Stocks Slide as Yield Pressure, Commodity Surge Prompts Equity Exit

Asian Markets Decline in Morning Trading

Asian Markets Decline in Morning Trading

Verizon Proves Resilient in Sell-Off; Decoding the Facebook Short -- ICYMI

Verizon Proves Resilient in Sell-Off; Decoding the Facebook Short -- ICYMI

Three Big Factors That Rocked the Stock Market Tuesday

Three Big Factors That Rocked the Stock Market Tuesday