3 Stocks Improving Performance Of The Internet Industry

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 22 points (0.1%) at 16,756 as of Friday, June 13, 2014, 3:55 PM ET. The NYSE advances/declines ratio sits at 1,626 issues advancing vs. 1,329 declining with 172 unchanged.

The Internet industry as a whole closed the day up 1.2% versus the S&P 500, which was up 0.2%. Top gainers within the Internet industry included Net Element ( NETE), up 3.6%, ChinaNet Online Holdings ( CNET), up 2.0%, Spark Networks ( LOV), up 2.6%, Rediff.com India ( REDF), up 4.2% and Care.com ( CRCM), up 5.8%.

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

Rediff.com India ( REDF) is one of the companies that pushed the Internet industry higher today. Rediff.com India was up $0.12 (4.2%) to $2.98 on average volume. Throughout the day, 262,675 shares of Rediff.com India exchanged hands as compared to its average daily volume of 338,900 shares. The stock ranged in a price between $2.82-$3.03 after having opened the day at $2.91 as compared to the previous trading day's close of $2.86.

Rediff.com India has a market cap of $87.4 million and is part of the technology sector. Shares are up 23.3% year-to-date as of the close of trading on Thursday.

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Highlights from TheStreet Ratings analysis on REDF go as follows:

You can view the full analysis from the report here: Rediff.com India 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.

At the close, Spark Networks ( LOV) was up $0.12 (2.6%) to $4.83 on light volume. Throughout the day, 55,866 shares of Spark Networks exchanged hands as compared to its average daily volume of 155,600 shares. The stock ranged in a price between $4.70-$4.94 after having opened the day at $4.75 as compared to the previous trading day's close of $4.71.

Spark Networks, Inc. provides online personals services in the United States and internationally. It operates in four segments: Jewish Networks, Christian Networks, Other Networks, and Offline and Other Businesses. Spark Networks has a market cap of $113.7 million and is part of the technology sector. Shares are down 22.6% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates Spark Networks a buy, no analysts rate it a sell, and 1 rates it a hold.

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

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

Highlights from TheStreet Ratings analysis on LOV go as follows:

  • The gross profit margin for SPARK NETWORKS INC is currently lower than what is desirable, coming in at 25.59%. Regardless of LOV's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, LOV's net profit margin of -17.40% significantly underperformed when compared to the industry average.
  • LOV's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 42.12%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Internet Software & Services industry. The net income increased by 1.6% when compared to the same quarter one year prior, going from -$2.94 million to -$2.89 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 Internet Software & Services industry and the overall market, SPARK NETWORKS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • LOV, with its decline in revenue, underperformed when compared the industry average of 21.2%. Since the same quarter one year prior, revenues slightly dropped by 3.7%. 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: Spark 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.

ChinaNet Online Holdings ( CNET) was another company that pushed the Internet industry higher today. ChinaNet Online Holdings was up $0.02 (2.0%) to $0.85 on light volume. Throughout the day, 18,996 shares of ChinaNet Online Holdings exchanged hands as compared to its average daily volume of 83,200 shares. The stock ranged in a price between $0.80-$0.85 after having opened the day at $0.80 as compared to the previous trading day's close of $0.83.

ChinaNet Online Holdings, Inc., through its subsidiaries, provides business-to-businesses Internet services for small and medium enterprises (SMEs) sales networks in the People's Republic of China. ChinaNet Online Holdings has a market cap of $17.9 million and is part of the technology sector. Shares are down 0.8% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate ChinaNet Online Holdings a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates ChinaNet Online Holdings as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, largely solid financial position with reasonable debt levels by most measures and attractive valuation levels. However, as a counter to these strengths, we find that the growth in the company's earnings per share has not been good.

Highlights from TheStreet Ratings analysis on CNET go as follows:

  • Compared to its closing price of one year ago, CNET's share price has jumped by 44.28%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, our hold rating indicates that we do not recommend additional investment in this stock despite its gains in the past year.
  • CNET's debt-to-equity ratio is very low at 0.02 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, CNET has a quick ratio of 1.75, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The revenue fell significantly faster than the industry average of 14.9%. Since the same quarter one year prior, revenues fell by 27.3%. Weakness in the company's revenue seems to not be hurting the bottom line, shown by stable earnings per share.
  • 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. When compared to other companies in the Media industry and the overall market, CHINANET ONLINE HOLDINGS's return on equity is below that of both the industry average and the S&P 500.
  • CHINANET ONLINE HOLDINGS reported flat earnings per share in the most recent quarter. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, CHINANET ONLINE HOLDINGS reported lower earnings of $0.13 versus $0.15 in the prior year.

You can view the full analysis from the report here: ChinaNet Online Holdings 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.

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