3 Stocks Pushing The Health Care Sector Lower

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The Health Care sector as a whole closed the day down 1.0% versus the S&P 500, which was down 0.1%. Laggards within the Health Care sector included ImmuCell ( ICCC), down 3.3%, Allied Healthcare Products ( AHPI), down 2.9%, SunLink Health Systems ( SSY), down 4.9%, Pro-Dex ( PDEX), down 4.7% and Vision-Sciences ( VSCI), down 1.9%.

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

PerkinElmer ( PKI) is one of the companies that pushed the Health Care sector lower today. PerkinElmer was down $1.80 (3.9%) to $44.42 on heavy volume. Throughout the day, 2,397,646 shares of PerkinElmer exchanged hands as compared to its average daily volume of 691,200 shares. The stock ranged in price between $43.06-$44.84 after having opened the day at $44.29 as compared to the previous trading day's close of $46.22.

PerkinElmer, Inc. provides products, services, and solutions to the diagnostics, research, environmental, industrial, and laboratory services markets worldwide. The company operates through two segments, Human Health and Environmental Health. PerkinElmer has a market cap of $5.3 billion and is part of the health services industry. Shares are up 12.1% year-to-date as of the close of trading on Thursday. Currently there are 12 analysts who rate PerkinElmer a buy, no analysts rate it a sell, and 2 rate it a hold.

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TheStreet Ratings rates PerkinElmer as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, growth in earnings per share, increase in net income, revenue growth and largely solid financial position with reasonable debt levels by most measures. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

Highlights from TheStreet Ratings analysis on PKI go as follows:

  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 41.18% over the past year, a rise that has exceeded that of the S&P 500 Index. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • PERKINELMER INC has improved earnings per share by 7.1% 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. During the past fiscal year, PERKINELMER INC increased its bottom line by earning $1.48 versus $0.59 in the prior year. This year, the market expects an improvement in earnings ($2.46 versus $1.48).
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Life Sciences Tools & Services industry average. The net income increased by 6.2% when compared to the same quarter one year prior, going from $32.22 million to $34.22 million.
  • PKI's revenue growth trails the industry average of 21.6%. Since the same quarter one year prior, revenues slightly increased by 5.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • 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. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.10, which illustrates the ability to avoid short-term cash problems.

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

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At the close, Vision-Sciences ( VSCI) was down $0.02 (1.9%) to $1.01 on light volume. Throughout the day, 16,204 shares of Vision-Sciences exchanged hands as compared to its average daily volume of 24,800 shares. The stock ranged in price between $1.00-$1.06 after having opened the day at $1.01 as compared to the previous trading day's close of $1.03.

Vision-Sciences, Inc., through its subsidiaries, designs, develops, manufactures, and markets endoscopy products. It operates through Medical and Industrial segments. Vision-Sciences has a market cap of $49.0 million and is part of the health services industry. Shares are up 3.0% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Vision-Sciences as a sell. The company's weaknesses can be seen in multiple areas, such as its poor profit margins and unimpressive growth in net income.

Highlights from TheStreet Ratings analysis on VSCI go as follows:

  • The gross profit margin for VISION-SCIENCES INC is currently lower than what is desirable, coming in at 31.02%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -48.08% is significantly below that of the industry average.
  • 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 15.8% when compared to the same quarter one year ago, dropping from -$2.07 million to -$2.40 million.
  • VISION-SCIENCES INC's earnings per share declined by 25.0% 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, VISION-SCIENCES INC continued to lose money by earning -$0.16 versus -$0.22 in the prior year.
  • 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.
  • Net operating cash flow has increased to -$1.37 million or 44.79% when compared to the same quarter last year. In addition, VISION-SCIENCES INC has also vastly surpassed the industry average cash flow growth rate of -17.69%.

You can view the full analysis from the report here: Vision-Sciences Ratings Report

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Allied Healthcare Products ( AHPI) was another company that pushed the Health Care sector lower today. Allied Healthcare Products was down $0.06 (2.9%) to $2.02 on average volume. Throughout the day, 9,765 shares of Allied Healthcare Products exchanged hands as compared to its average daily volume of 8,500 shares. The stock ranged in price between $2.02-$2.12 after having opened the day at $2.03 as compared to the previous trading day's close of $2.08.

Allied Healthcare Products, Inc. manufactures, markets, and distributes respiratory care products, medical gas equipment, and emergency medical products in Canada, Mexico, Central and South America, Europe, the Middle East, and the Far East. Allied Healthcare Products has a market cap of $16.5 million and is part of the health services industry. Shares are down 8.8% year-to-date as of the close of trading on Thursday.

TheStreet Ratings rates Allied Healthcare Products 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 generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on AHPI go as follows:

  • ALLIED HEALTHCARE PRODS INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, ALLIED HEALTHCARE PRODS INC reported poor results of -$0.15 versus -$0.06 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 Health Care Equipment & Supplies industry. The net income has significantly decreased by 247.3% when compared to the same quarter one year ago, falling from -$0.28 million to -$0.97 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 Health Care Equipment & Supplies industry and the overall market, ALLIED HEALTHCARE PRODS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for ALLIED HEALTHCARE PRODS INC is rather low; currently it is at 22.80%. Regardless of AHPI's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, AHPI's net profit margin of -10.63% significantly underperformed when compared to the industry average.
  • The share price of ALLIED HEALTHCARE PRODS INC has not done very well: it is down 17.72% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. 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.

You can view the full analysis from the report here: Allied Healthcare Products Ratings Report

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