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The Diversified Services industry as a whole closed the day down 0.4% versus the S&P 500, which was up 0.1%. Laggards within the Diversified Services industry included Learning Tree International ( LTRE), down 1.6%, Bioanalytical Systems ( BASI), down 1.5%, Magal Security Systems ( MAGS), down 4.0%, SmartPros ( SPRO), down 4.6% and Industrial Services of America ( IDSA), down 6.0%.

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

Magal Security Systems ( MAGS) is one of the companies that pushed the Diversified Services industry lower today. Magal Security Systems was down $0.16 (4.0%) to $3.81 on light volume. Throughout the day, 3,840 shares of Magal Security Systems exchanged hands as compared to its average daily volume of 11,200 shares. The stock ranged in price between $3.81-$3.86 after having opened the day at $3.86 as compared to the previous trading day's close of $3.97.

Magal Security Systems Ltd. develops, manufactures, and sells safety, security, site management, and intelligence gathering and compilation solutions and products worldwide. It operates through: Perimeter Products, Turnkey Projects, and Cyber segments. Magal Security Systems has a market cap of $65.9 million and is part of the services sector. Shares are up 11.5% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Magal Security Systems as a hold. Among the primary strengths of the company is its solid financial position based on a variety of debt and liquidity measures that we have evaluated. At the same time, however, we also find weaknesses including feeble growth in the company's earnings per share, deteriorating net income and disappointing return on equity.

Highlights from TheStreet Ratings analysis on MAGS go as follows:

  • MAGS's debt-to-equity ratio is very low at 0.15 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, MAGS has a quick ratio of 2.35, which demonstrates the ability of the company to cover short-term liquidity needs.
  • MAGS, with its decline in revenue, underperformed when compared the industry average of 9.2%. Since the same quarter one year prior, revenues slightly dropped by 7.0%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • In its most recent trading session, MAGS has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. 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.
  • 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 Electronic Equipment, Instruments & Components industry and the overall market, MAGAL SECURITY SYSTEMS's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for MAGAL SECURITY SYSTEMS is currently lower than what is desirable, coming in at 32.68%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -15.78% is significantly below that of the industry average.

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

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At the close, Bioanalytical Systems ( BASI) was down $0.04 (1.5%) to $2.56 on light volume. Throughout the day, 8,929 shares of Bioanalytical Systems exchanged hands as compared to its average daily volume of 12,200 shares. The stock ranged in price between $2.56-$2.63 after having opened the day at $2.60 as compared to the previous trading day's close of $2.60.

Bioanalytical Systems, Inc. provides drug discovery and development services, and analytical instruments for pharmaceutical, biotechnology, academic, and government organizations in North America, the Pacific Rim, Europe, and internationally. Bioanalytical Systems has a market cap of $21.1 million and is part of the services sector. Shares are down 3.6% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Bioanalytical Systems as a sell. The area that we feel has been the company's primary weakness has been its unimpressive growth in net income.

Highlights from TheStreet Ratings analysis on BASI go as follows:

  • The company, on the basis of net income growth from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Life Sciences Tools & Services industry average. The net income increased by 29.6% when compared to the same quarter one year prior, rising from -$0.31 million to -$0.22 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 Life Sciences Tools & Services industry and the overall market on the basis of return on equity, BIOANALYTICAL SYSTEMS INC underperformed against that of the industry average and is significantly less than that of the S&P 500.
  • The current debt-to-equity ratio, 0.58, is low and is below the industry average, implying that there has been successful management of debt levels. Even though the company has a strong debt-to-equity ratio, the quick ratio of 0.30 is very weak and demonstrates a lack of ability to pay short-term obligations.
  • 40.75% is the gross profit margin for BIOANALYTICAL SYSTEMS INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -3.70% is in-line with the industry average.
  • Net operating cash flow has significantly increased by 85.51% to -$0.03 million when compared to the same quarter last year. In addition, BIOANALYTICAL SYSTEMS INC has also vastly surpassed the industry average cash flow growth rate of -48.30%.

You can view the full analysis from the report here: Bioanalytical Systems 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 $0.04 (1.6%) to $2.52 on light volume. Throughout the day, 214 shares of Learning Tree International exchanged hands as compared to its average daily volume of 1,600 shares. The stock ranged in price between $2.52-$2.52 after having opened the day at $2.52 as compared to the previous trading day's close of $2.56.

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 $35.7 million and is part of the services sector. Shares are down 18.5% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates Learning Tree International as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, weak operating cash flow and generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on LTRE 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 Diversified Consumer Services industry. The net income has decreased by 14.6% when compared to the same quarter one year ago, dropping from -$4.02 million to -$4.60 million.
  • Net operating cash flow has significantly decreased to -$4.36 million or 87.65% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, LTRE has underperformed the S&P 500 Index, declining 19.52% 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'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.
  • 42.87% is the gross profit margin for LEARNING TREE INTL INC which we consider to be strong. 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 -18.40% significantly underperformed when compared to the industry average.

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

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