3 Stocks Pushing The Diversified Services Industry Higher

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.

All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 69 points (0.4%) at 16,676 as of Tuesday, May 27, 2014, 4:10 PM ET. The NYSE advances/declines ratio sits at 2,099 issues advancing vs. 953 declining with 142 unchanged.

The Diversified Services industry as a whole closed the day up 1.4% versus the S&P 500, which was up 0.6%. Top gainers within the Diversified Services industry included China Yida ( CNYD), up 5.5%, RLJ Entertainment ( RLJE), up 3.9%, UniTek Global Services ( UNTK), up 2.8%, Lime Energy ( LIME), up 3.1% and Bioanalytical Systems ( BASI), up 4.2%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the industry higher today:

UniTek Global Services ( UNTK) is one of the companies that pushed the Diversified Services industry higher today. UniTek Global Services was up $0.02 (2.8%) to $0.73 on heavy volume. Throughout the day, 87,948 shares of UniTek Global Services exchanged hands as compared to its average daily volume of 42,500 shares. The stock ranged in a price between $0.60-$0.79 after having opened the day at $0.79 as compared to the previous trading day's close of $0.71.

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 $13.7 million and is part of the services sector. Shares are down 57.5% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate UniTek Global Services a buy, no analysts rate 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 deteriorating net income, poor profit margins, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

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 when compared to that of the S&P 500 and the Construction & Engineering industry. The net income has significantly decreased by 156.1% when compared to the same quarter one year ago, falling from -$7.66 million to -$19.63 million.
  • The gross profit margin for UNITEK GLOBAL SERVICES INC is currently extremely low, coming in at 14.98%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -22.15% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$2.32 million or 135.15% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 60.95%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 175.67% compared to 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.
  • UNITEK GLOBAL SERVICES INC 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 year. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, UNITEK GLOBAL SERVICES INC reported poor results of -$2.65 versus -$2.28 in the prior year. This year, the market expects an improvement in earnings (-$0.99 versus -$2.65).

You can view the full analysis from the report here: UniTek Global Services Ratings Report

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At the close, RLJ Entertainment ( RLJE) was up $0.13 (3.9%) to $3.49 on light volume. Throughout the day, 309 shares of RLJ Entertainment exchanged hands as compared to its average daily volume of 6,600 shares. The stock ranged in a price between $3.38-$3.49 after having opened the day at $3.38 as compared to the previous trading day's close of $3.36.

RLJ Entertainment, Inc., an entertainment company, acquires content rights in British episodic mystery and drama, urban programming, and full-length motion pictures. It operates through three segments: Intellectual Property Licensing, Wholesale, and Direct-to-Consumer. RLJ Entertainment has a market cap of $46.1 million and is part of the services sector. Shares are down 29.9% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate RLJ Entertainment a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates RLJ Entertainment as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on RLJE go as follows:

  • 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, RLJ ENTERTAINMENT INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for RLJ ENTERTAINMENT INC is rather low; currently it is at 23.47%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -3.59% is significantly below that of the industry average.
  • RLJE has underperformed the S&P 500 Index, declining 11.67% 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.
  • RLJ ENTERTAINMENT INC has improved earnings per share by 44.0% 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, RLJ ENTERTAINMENT INC reported poor results of -$2.30 versus -$0.49 in the prior year.
  • RLJE, with its decline in revenue, underperformed when compared the industry average of 14.9%. Since the same quarter one year prior, revenues slightly dropped by 4.0%. 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: RLJ Entertainment 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.

China Yida ( CNYD) was another company that pushed the Diversified Services industry higher today. China Yida was up $0.17 (5.5%) to $3.29 on heavy volume. Throughout the day, 10,889 shares of China Yida exchanged hands as compared to its average daily volume of 4,500 shares. The stock ranged in a price between $2.90-$3.50 after having opened the day at $3.19 as compared to the previous trading day's close of $3.12.

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 $12.2 million and is part of the services sector. Shares are up 8.3% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate China Yida a buy, no analysts rate it a sell, and none rate it a hold.

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.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 35.17%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 397.05% 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

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

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.