Ann Inc. (ANN): 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

Ann ( ANN) pushed the Services sector lower today making it today's featured Services laggard. The sector as a whole closed the day up 1.0%. By the end of trading, Ann fell $0.42 (-1.3%) to $30.83 on average volume. Throughout the day, 1,032,709 shares of Ann exchanged hands as compared to its average daily volume of 1,260,000 shares. The stock ranged in price between $30.71-$31.51 after having opened the day at $31.24 as compared to the previous trading day's close of $31.25. Other companies within the Services sector that declined today were: StarTek ( SRT), down 21.3%, Torm A/S ( TRMD), down 13.7%, Rada Electronics Industries ( RADA), down 10.9% and XO Group ( XOXO), down 9.6%.
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ANN Inc., through its subsidiaries, engages in the retailing of women's apparel, shoes, and accessories under the Ann Taylor and LOFT brands. Ann has a market cap of $1.4 billion and is part of the retail industry. The company has a P/E ratio of 14.4, below the S&P 500 P/E ratio of 17.7. Shares are down 7.7% year to date as of the close of trading on Thursday. Currently there are 5 analysts that rate Ann a buy, no analysts rate it a sell, and 8 rate it a hold.

TheStreet Ratings rates Ann as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, reasonable valuation levels, impressive record of earnings per share growth and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

On the positive front, Sport Chalet ( SPCHA), down 33.3%, Sport Chalet ( SPCHB), down 26.5%, Frozen Food Express Industries ( FFEX), down 22.7% and VirtualScopics ( VSCP), down 20.4% , were all gainers within the services sector with AutoZone ( AZO) 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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