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 1.3% versus the S&P 500, which was down 0.5%. Laggards within the Diversified Services industry included Learning Tree International ( LTRE), down 1.6%, China Yida ( CNYD), down 4.1%, General Employment ( JOB), down 2.3%, UniTek Global Services ( UNTK), down 19.2% and Bioanalytical Systems ( BASI), down 3.7%.

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

UniTek Global Services ( UNTK) is one of the companies that pushed the Diversified Services industry lower today. UniTek Global Services was down $0.29 (19.2%) to $1.22 on heavy volume. Throughout the day, 133,682 shares of UniTek Global Services exchanged hands as compared to its average daily volume of 20,900 shares. The stock ranged in price between $1.21-$1.60 after having opened the day at $1.60 as compared to the previous trading day's close of $1.51.

UniTek Global Services, Inc. provides technical services to the wireless telecommunications, public safety, satellite television, and broadband cable industries in the United States and Canada. The company operates in two segments, Fulfillment, and Engineering and Construction. UniTek Global Services has a market cap of $30.6 million and is part of the services sector. Shares are down 9.6% year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate UniTek Global Services a buy, 1 analyst rates it a sell, and 1 rates it a hold.

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TheStreet Ratings rates UniTek Global Services as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, generally high debt management risk, disappointing return on equity, poor profit margins and weak operating cash flow.

Highlights from TheStreet Ratings analysis on UNTK go as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Construction & Engineering industry. The net income has decreased by 12.1% when compared to the same quarter one year ago, dropping from -$22.65 million to -$25.39 million.
  • The debt-to-equity ratio is very high at 16.57 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, UNTK maintains a poor quick ratio of 0.95, which illustrates the inability to avoid short-term cash problems.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Construction & Engineering industry and the overall market, UNITEK GLOBAL SERVICES INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for UNITEK GLOBAL SERVICES INC is rather low; currently it is at 16.93%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -23.75% is significantly below that of the industry average.
  • Net operating cash flow has decreased to $10.77 million or 23.82% 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: UniTek Global Services Ratings Report

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At the close, China Yida ( CNYD) was down $0.12 (4.1%) to $2.83 on average volume. Throughout the day, 3,539 shares of China Yida exchanged hands as compared to its average daily volume of 4,000 shares. The stock ranged in price between $2.83-$3.05 after having opened the day at $3.00 as compared to the previous trading day's close of $2.95.

China Yida Holding Co., together with its subsidiaries, engages in the tourism and advertisement businesses in the People's Republic of China. China Yida has a market cap of $11.5 million and is part of the services sector. Shares are up 2.4% year-to-date as of the close of trading on Tuesday.

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

Highlights from TheStreet Ratings analysis on CNYD go as follows:

  • CHINA YIDA HOLDING CO has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, CHINA YIDA HOLDING CO swung to a loss, reporting -$4.38 versus $0.06 in the prior year.
  • 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 Media industry. The net income has significantly decreased by 328.0% when compared to the same quarter one year ago, falling from -$1.54 million to -$6.60 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Media industry and the overall market, CHINA YIDA HOLDING CO's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$0.11 million or 118.99% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The share price of CHINA YIDA HOLDING CO has not done very well: it is down 22.25% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.

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

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Learning Tree International ( LTRE) was another company that pushed the Diversified Services industry lower today. Learning Tree International was down $0.05 (1.6%) to $3.00 on light volume. Throughout the day, 100 shares of Learning Tree International exchanged hands as compared to its average daily volume of 1,900 shares. The stock ranged in price between $3.00-$3.00 after having opened the day at $3.00 as compared to the previous trading day's close of $3.05.

Learning Tree International, Inc., together with its subsidiaries, develops, markets, and delivers a library of instructor-led classroom courses to meet the professional development needs of information technology (IT) professionals and managers worldwide. Learning Tree International has a market cap of $40.3 million and is part of the services sector. Shares are down 2.9% year-to-date as of the close of trading on Tuesday.

TheStreet Ratings rates Learning Tree International as a sell. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on LTRE go as follows:

  • LTRE has underperformed the S&P 500 Index, declining 20.78% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Diversified Consumer Services industry average, but is greater than that of the S&P 500. The net income increased by 151.5% when compared to the same quarter one year prior, rising from -$1.42 million to $0.73 million.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Diversified Consumer Services industry and the overall market, LEARNING TREE INTL INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for LEARNING TREE INTL INC is rather high; currently it is at 50.32%. Regardless of LTRE's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, LTRE's net profit margin of 2.27% is significantly lower than the industry average.
  • LTRE, with its decline in revenue, slightly underperformed the industry average of 2.1%. Since the same quarter one year prior, revenues slightly dropped by 3.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

You can view the full analysis from the report here: Learning Tree International 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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