3 Stocks Pushing The Health Care Sector 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 Health Care sector as a whole closed the day down 2.3% versus the S&P 500, which was down 0.5%. Laggards within the Health Care sector included Aoxing Pharmaceutical ( AXN), down 4.5%, Reliv' International ( RELV), down 1.8%, Pro-Dex ( PDEX), down 2.3%, Bio-Rad Laboratories ( BIO.B), down 1.6% and Neovasc ( NVCN), down 2.0%.

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

Grifols ( GRFS) is one of the companies that pushed the Health Care sector lower today. Grifols was down $1.51 (3.5%) to $42.18 on average volume. Throughout the day, 560,387 shares of Grifols exchanged hands as compared to its average daily volume of 670,000 shares. The stock ranged in price between $42.12-$43.85 after having opened the day at $43.85 as compared to the previous trading day's close of $43.69.

Grifols, S.A., a specialty biopharmaceutical company, develops, manufactures, and distributes a range of plasma derivative products primarily in the European Union, Spain, the United States, Canada, and internationally. Grifols has a market cap of $15.0 billion and is part of the drugs industry. Shares are up 21.0% year-to-date as of the close of trading on Thursday. Currently there are 3 analysts who rate Grifols a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Grifols as a hold. The company's strengths can be seen in multiple areas, such as its solid stock price performance, impressive record of earnings per share growth and compelling growth in net income. However, as a counter to these strengths, we find that the company has favored debt over equity in the management of its balance sheet.

Highlights from TheStreet Ratings analysis on GRFS go as follows:

  • Powered by its strong earnings growth of 37.14% and other important driving factors, this stock has surged by 50.73% over the past year, outperforming the rise in the S&P 500 Index during the same period. 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.
  • GRIFOLS SA has improved earnings per share by 37.1% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, GRIFOLS SA increased its bottom line by earning $1.39 versus $0.96 in the prior year. This year, the market expects an improvement in earnings ($2.64 versus $1.39).
  • The gross profit margin for GRIFOLS SA is rather high; currently it is at 55.19%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, GRFS's net profit margin of 15.15% significantly trails the industry average.
  • Currently the debt-to-equity ratio of 1.72 is quite high overall and when compared to the industry average, suggesting that the current management of debt levels should be re-evaluated. Regardless of the company's weak debt-to-equity ratio, GRFS has managed to keep a strong quick ratio of 1.85, which demonstrates the ability to cover short-term cash needs.

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

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At the close, Reliv' International ( RELV) was down $0.03 (1.8%) to $1.67 on heavy volume. Throughout the day, 32,908 shares of Reliv' International exchanged hands as compared to its average daily volume of 11,100 shares. The stock ranged in price between $1.60-$1.85 after having opened the day at $1.63 as compared to the previous trading day's close of $1.70.

Reliv' International, Inc. develops, manufactures, and markets nutritional supplements that promote basic nutrition, weight loss, athletic performance, digestive health, women's health, anti-aging, and healthy energy. Reliv' International has a market cap of $21.5 million and is part of the drugs industry. Shares are down 39.5% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Reliv' International as a hold. The company's strengths can be seen in multiple areas, such as its expanding profit margins, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. However, as a counter to these strengths, 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 RELV go as follows:

  • The gross profit margin for RELIV INTERNATIONAL INC is currently very high, coming in at 81.71%. 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 -1.04% trails the industry average.
  • RELV's debt-to-equity ratio is very low at 0.27 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.82 is somewhat weak and could be cause for future problems.
  • RELV, with its decline in revenue, underperformed when compared the industry average of 0.2%. Since the same quarter one year prior, revenues fell by 23.3%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Personal Products industry and the overall market, RELIV INTERNATIONAL INC'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 -$1.36 million or 324.34% 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: Reliv' International Ratings Report

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Aoxing Pharmaceutical ( AXN) was another company that pushed the Health Care sector lower today. Aoxing Pharmaceutical was down $0.02 (4.5%) to $0.33 on light volume. Throughout the day, 17,050 shares of Aoxing Pharmaceutical exchanged hands as compared to its average daily volume of 39,700 shares. The stock ranged in price between $0.33-$0.38 after having opened the day at $0.37 as compared to the previous trading day's close of $0.35.

Aoxing Pharmaceutical Company, Inc., a specialty pharmaceutical company, researches, develops, manufactures, and distributes various narcotic, pain-management, and addiction treatment pharmaceutical products primarily in the People's Republic of China. Aoxing Pharmaceutical has a market cap of $17.2 million and is part of the drugs industry. Shares are up 38.6% year-to-date as of the close of trading on Thursday.

TheStreet Ratings rates Aoxing Pharmaceutical as a sell. Among the areas we feel are negative, one of the most important has been weak operating cash flow.

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Highlights from TheStreet Ratings analysis on AXN go as follows:

  • Net operating cash flow has decreased to -$4.35 million or 41.91% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • AOXING PHARMACEUTICAL CO INC has improved earnings per share by 20.0% 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, AOXING PHARMACEUTICAL CO INC reported poor results of -$0.34 versus -$0.32 in the prior year.
  • 43.50% is the gross profit margin for AOXING PHARMACEUTICAL CO 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, AXN's net profit margin of -74.48% significantly underperformed when compared to the industry average.
  • Investors have driven up the company's shares by 34.69% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the future course of this stock, we feel that the risks involved in investing in AXN do not compensate for any future upside potential, despite the fact that it has seen nice gains over the past 12 months.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the Pharmaceuticals industry average, but is less than that of the S&P 500. The net income increased by 29.8% when compared to the same quarter one year prior, rising from -$2.60 million to -$1.82 million.

You can view the full analysis from the report here: Aoxing Pharmaceutical 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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