3 Stocks Pushing The Diversified Services Industry Lower

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

The Diversified Services industry as a whole closed the day down 0.6% versus the S&P 500, which was up 0.6%. Laggards within the Diversified Services industry included VirtualScopics ( VSCP), down 3.7%, Birner Dental Management Services ( BDMS), down 1.6%, RMG Networks ( RMGN), down 4.3%, Command Security ( MOC), down 2.0% and National American University Holdings ( NAUH), down 3.1%.

TheStreet Ratings Group would like to highlight 3 stocks that pushed the industry lower today:

Command Security ( MOC) is one of the companies that pushed the Diversified Services industry lower today. Command Security was down $0.04 (2.0%) to $1.91 on light volume. Throughout the day, 1,701 shares of Command Security exchanged hands as compared to its average daily volume of 19,000 shares. The stock ranged in price between $1.89-$1.95 after having opened the day at $1.95 as compared to the previous trading day's close of $1.95.

Command Security Corporation provides uniformed security officers and aviation security services to commercial, financial, industrial, aviation, and governmental customers in the United States. Command Security has a market cap of $18.5 million and is part of the financial sector. Shares are down 3.4% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates Command Security as a hold. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including weak operating cash flow and poor profit margins.

Highlights from TheStreet Ratings analysis on MOC go as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Services & Supplies industry. The net income increased by 64.6% when compared to the same quarter one year prior, rising from $0.35 million to $0.58 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 4.6%. Since the same quarter one year prior, revenues slightly increased by 3.9%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Compared to where it was 12 months ago, the stock is up, but it has so far lagged the appreciation in the S&P 500. Looking ahead, our view is that this company's fundamentals will not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
  • The gross profit margin for COMMAND SECURITY CORP is currently extremely low, coming in at 14.22%. Regardless of MOC's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 1.43% trails the industry average.
  • Net operating cash flow has significantly decreased to $0.34 million or 78.45% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

You can view the full analysis from the report here: Command Security Ratings Report

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At the close, RMG Networks ( RMGN) was down $0.15 (4.3%) to $3.30 on heavy volume. Throughout the day, 26,420 shares of RMG Networks exchanged hands as compared to its average daily volume of 10,500 shares. The stock ranged in price between $3.27-$3.50 after having opened the day at $3.43 as compared to the previous trading day's close of $3.45.

RMG Networks has a market cap of $44.5 million and is part of the financial sector. Shares are down 29.0% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates RMG Networks a buy, no analysts rate it a sell, and none rate it a hold.

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Highlights from TheStreet Ratings analysis on RMGN go as follows:

You can view the full analysis from the report here: RMG Networks Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

VirtualScopics ( VSCP) was another company that pushed the Diversified Services industry lower today. VirtualScopics was down $0.14 (3.7%) to $3.65 on light volume. Throughout the day, 2,452 shares of VirtualScopics exchanged hands as compared to its average daily volume of 4,200 shares. The stock ranged in price between $3.65-$3.84 after having opened the day at $3.70 as compared to the previous trading day's close of $3.79.

VirtualScopics, Inc. provides imaging solutions for the pharmaceutical, biotechnology, and medical device industries. VirtualScopics has a market cap of $10.9 million and is part of the financial sector. Shares are up 9.6% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates VirtualScopics a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates VirtualScopics as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Highlights from TheStreet Ratings analysis on VSCP go as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Life Sciences Tools & Services industry. The net income has significantly decreased by 31.3% when compared to the same quarter one year ago, falling from -$0.77 million to -$1.02 million.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Life Sciences Tools & Services industry and the overall market, VIRTUALSCOPICS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to $0.39 million or 25.00% when compared to the same quarter last year. Despite a decrease in cash flow VIRTUALSCOPICS INC is still fairing well by exceeding its industry average cash flow growth rate of -55.26%.
  • Looking at the price performance of VSCP's shares over the past 12 months, there is not much good news to report: the stock is down 27.55%, and it has underformed the S&P 500 Index. In addition, the company's earnings per share are lower today than the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • VIRTUALSCOPICS INC's earnings per share declined by 16.7% in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, VIRTUALSCOPICS INC continued to lose money by earning -$1.02 versus -$1.10 in the prior year.

You can view the full analysis from the report here: VirtualScopics Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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