3 Stocks Pushing The Health Services Industry Lower

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The Health Services industry as a whole closed the day down 0.7% versus the S&P 500, which was down 0.7%. Laggards within the Health Services industry included SunLink Health Systems ( SSY), down 1.6%, VirtualScopics ( VSCP), down 5.0%, American Shared Hospital Services ( AMS), down 1.5%, CAS Medical Systems ( CASM), down 2.0% and USMD Holdings ( USMD), down 5.0%.

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

Opko Health ( OPK) is one of the companies that pushed the Health Services industry lower today. Opko Health was down $0.29 (3.2%) to $8.76 on heavy volume. Throughout the day, 4,013,538 shares of Opko Health exchanged hands as compared to its average daily volume of 2,296,900 shares. The stock ranged in price between $8.75-$9.11 after having opened the day at $9.08 as compared to the previous trading day's close of $9.05.

Opko Health, Inc., a biopharmaceutical and diagnostics company, is engaged in the discovery, development, and commercialization of novel and proprietary technologies. It operates in two segments, Pharmaceuticals and Diagnostics. Opko Health has a market cap of $3.8 billion and is part of the health care sector. Shares are up 7.2% year-to-date as of the close of trading on Monday. Currently there are 4 analysts who rate Opko Health a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Opko Health 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 expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and feeble growth in the company's earnings per share.

Highlights from TheStreet Ratings analysis on OPK go as follows:

  • Compared to its closing price of one year ago, OPK's share price has jumped by 31.44%, 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.
  • OPK's debt-to-equity ratio is very low at 0.29 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, OPK has a quick ratio of 2.11, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 48.05% is the gross profit margin for OPKO HEALTH INC which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, OPK's net profit margin of -200.01% significantly underperformed when compared to the industry average.
  • 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 Biotechnology industry. The net income has significantly decreased by 30.2% when compared to the same quarter one year ago, falling from -$34.22 million to -$44.55 million.
  • Net operating cash flow has significantly decreased to -$29.05 million or 96.98% 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: Opko Health Ratings Report

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At the close, CAS Medical Systems ( CASM) was down $0.04 (2.0%) to $2.00 on light volume. Throughout the day, 4,985 shares of CAS Medical Systems exchanged hands as compared to its average daily volume of 20,400 shares. The stock ranged in price between $2.00-$2.10 after having opened the day at $2.00 as compared to the previous trading day's close of $2.04.

CAS Medical Systems, Inc., a medical technology company, develops, manufactures, and markets medical devices for non-invasive patient monitoring in the United States and internationally. CAS Medical Systems has a market cap of $40.4 million and is part of the health care sector. Shares are up 22.4% year-to-date as of the close of trading on Monday. Currently there is 1 analyst who rates CAS Medical Systems a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates CAS Medical Systems as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and deteriorating net income.

Highlights from TheStreet Ratings analysis on CASM 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 Health Care Equipment & Supplies industry and the overall market, CAS MEDICAL SYSTEMS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The change in net income from the same quarter one year ago has exceeded that of the Health Care Equipment & Supplies industry average, but is less than that of the S&P 500. The net income has decreased by 16.5% when compared to the same quarter one year ago, dropping from -$1.59 million to -$1.85 million.
  • CAS MEDICAL SYSTEMS INC has improved earnings per share by 21.4% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, CAS MEDICAL SYSTEMS INC reported poor results of -$0.74 versus -$0.64 in the prior year. This year, the market expects an improvement in earnings (-$0.44 versus -$0.74).
  • CASM's debt-to-equity ratio of 0.62 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that CASM's debt-to-equity ratio is mixed in its results, the company's quick ratio of 1.74 is high and demonstrates strong liquidity.
  • 48.40% is the gross profit margin for CAS MEDICAL 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 -32.37% is in-line with the industry average.

You can view the full analysis from the report here: CAS Medical Systems 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 Health Services industry lower today. VirtualScopics was down $0.25 (5.0%) to $4.75 on heavy volume. Throughout the day, 16,831 shares of VirtualScopics exchanged hands as compared to its average daily volume of 5,800 shares. The stock ranged in price between $4.50-$4.80 after having opened the day at $4.50 as compared to the previous trading day's close of $5.00.

VirtualScopics, Inc. provides imaging solutions for the pharmaceutical, biotechnology, and medical device industries. VirtualScopics has a market cap of $16.2 million and is part of the health care sector. Shares are up 44.5% year-to-date as of the close of trading on Monday. 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. Among the areas we feel are negative, one of the most important has been poor profit margins.

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Highlights from TheStreet Ratings analysis on VSCP go as follows:

  • The gross profit margin for VIRTUALSCOPICS INC is currently lower than what is desirable, coming in at 32.24%. Regardless of VSCP's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, VSCP's net profit margin of -27.44% significantly underperformed when compared to the industry average.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. 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.
  • VSCP, with its decline in revenue, underperformed when compared the industry average of 18.7%. Since the same quarter one year prior, revenues slightly dropped by 7.1%. The declining revenue has not hurt the company's bottom line, with increasing 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. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500, but is less than that of the Life Sciences Tools & Services industry average. The net income increased by 42.0% when compared to the same quarter one year prior, rising from -$1.11 million to -$0.65 million.

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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