3 Stocks Pushing The Services 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 Services sector as a whole closed the day up 0.4% versus the S&P 500, which was up 0.1%. Laggards within the Services sector included Bowl America ( BWL.A), down 4.7%, Liberty Interactive ( LINTB), down 3.6%, DLH Holdings ( DLHC), down 2.6%, ChinaNet Online Holdings ( CNET), down 11.6% and Nevada Gold & Casinos ( UWN), down 2.2%.

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

Nevada Gold & Casinos ( UWN) is one of the companies that pushed the Services sector lower today. Nevada Gold & Casinos was down $0.03 (2.2%) to $1.20 on light volume. Throughout the day, 11,538 shares of Nevada Gold & Casinos exchanged hands as compared to its average daily volume of 19,100 shares. The stock ranged in price between $1.08-$1.25 after having opened the day at $1.25 as compared to the previous trading day's close of $1.23.

Nevada Gold & Casinos, Inc., a gaming company, engages in financing, developing, owning, and operating gaming properties and projects primarily in Washington, South Dakota, and Colorado. The company operates in four segments: Washington Gold, South Dakota Gold, Corporate, and Assets. Nevada Gold & Casinos has a market cap of $19.4 million and is part of the media industry. Shares are down 10.2% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates Nevada Gold & Casinos as a hold. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, expanding profit margins and solid stock price performance. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income and weak operating cash flow.

Highlights from TheStreet Ratings analysis on UWN go as follows:

  • The current debt-to-equity ratio, 0.46, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, UWN has a quick ratio of 1.59, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 37.29% is the gross profit margin for NEVADA GOLD & CASINOS INC which we consider to be strong. Regardless of UWN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, UWN's net profit margin of -1.37% significantly underperformed when compared to the industry average.
  • Net operating cash flow has significantly decreased to $0.41 million or 69.13% when compared to the same quarter last year. Despite a decrease in cash flow NEVADA GOLD & CASINOS INC is still fairing well by exceeding its industry average cash flow growth rate of -80.10%.
  • 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 Hotels, Restaurants & Leisure industry. The net income has significantly decreased by 186.4% when compared to the same quarter one year ago, falling from $0.24 million to -$0.20 million.

You can view the full analysis from the report here: Nevada Gold & Casinos Ratings Report

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At the close, ChinaNet Online Holdings ( CNET) was down $0.08 (11.6%) to $0.65 on average volume. Throughout the day, 45,138 shares of ChinaNet Online Holdings exchanged hands as compared to its average daily volume of 31,600 shares. The stock ranged in price between $0.65-$0.72 after having opened the day at $0.71 as compared to the previous trading day's close of $0.74.

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 $16.3 million and is part of the media industry. Shares are down 13.1% year-to-date as of the close of trading on Tuesday.

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TheStreet Ratings rates ChinaNet Online Holdings 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, poor profit margins and weak operating cash flow.

Highlights from TheStreet Ratings analysis on CNET go as follows:

  • CHINANET ONLINE HOLDINGS's earnings have gone downhill when comparing its most recently reported quarter with the same quarter a year earlier. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, CHINANET ONLINE HOLDINGS swung to a loss, reporting -$0.01 versus $0.13 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 2326.7% when compared to the same quarter one year ago, falling from $0.03 million to -$0.67 million.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Media industry and the overall market, CHINANET ONLINE HOLDINGS's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for CHINANET ONLINE HOLDINGS is currently lower than what is desirable, coming in at 26.26%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -12.88% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$1.35 million or 213.45% 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: 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.

Liberty Interactive ( LINTB) was another company that pushed the Services sector lower today. Liberty Interactive was down $1.05 (3.6%) to $28.20 on heavy volume. Throughout the day, 1,258 shares of Liberty Interactive exchanged hands as compared to its average daily volume of 400 shares. The stock ranged in price between $28.15-$28.20 after having opened the day at $28.15 as compared to the previous trading day's close of $29.25.

Liberty Interactive has a market cap of $844.8 million and is part of the media industry. Shares are down 0.5% year-to-date as of the close of trading on Tuesday.

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

Highlights from TheStreet Ratings analysis on LINTB go as follows:

You can view the full analysis from the report here: Liberty Interactive 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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