3 Stocks Pushing The Services Sector Lower

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The Services sector as a whole closed the day down 0.6% versus the S&P 500, which was down 0.9%. Laggards within the Services sector included Rada Electronics Industries ( RADA), down 2.0%, Liberty Interactive ( LINTB), down 2.5%, Radio One ( ROIA), down 21.3%, Spar Group ( SGRP), down 6.2% and Alon Blue Square Israel ( BSI), down 3.1%.

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

Spar Group ( SGRP) is one of the companies that pushed the Services sector lower today. Spar Group was down $0.09 (6.2%) to $1.33 on average volume. Throughout the day, 10,874 shares of Spar Group exchanged hands as compared to its average daily volume of 10,500 shares. The stock ranged in price between $1.33-$1.38 after having opened the day at $1.37 as compared to the previous trading day's close of $1.42.

SPAR Group Inc., together with its subsidiaries, provides merchandising and other marketing services worldwide. Spar Group has a market cap of $29.1 million and is part of the transportation industry. Shares are down 28.3% year-to-date as of the close of trading on Monday.

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

Highlights from TheStreet Ratings analysis on SGRP go as follows:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 12.9%. Since the same quarter one year prior, revenues rose by 12.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • SGRP's debt-to-equity ratio is very low at 0.24 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, SGRP has a quick ratio of 2.08, which demonstrates the ability of the company to cover short-term liquidity needs.
  • SPAR GROUP INC's earnings have gone downhill when comparing its most recently reported quarter with the same quarter a year earlier. 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, SPAR GROUP INC increased its bottom line by earning $0.15 versus $0.13 in the prior year.
  • Net operating cash flow has significantly decreased to $2.47 million or 50.56% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • 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 938.6% when compared to the same quarter one year ago, falling from $0.04 million to -$0.37 million.

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

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At the close, Radio One ( ROIA) was down $0.90 (21.3%) to $3.32 on heavy volume. Throughout the day, 11,078 shares of Radio One exchanged hands as compared to its average daily volume of 2,800 shares. The stock ranged in price between $3.32-$5.00 after having opened the day at $5.00 as compared to the previous trading day's close of $4.22.

Radio One, Inc., together with its subsidiaries, operates as an urban-oriented multi-media company in the United States. The company operates through four segments: Radio Broadcasting, Reach Media, Internet, and Cable Television. Radio One has a market cap of $9.8 million and is part of the transportation industry. Shares are up 11.0% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates Radio One as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity and generally high debt management risk.

Highlights from TheStreet Ratings analysis on ROIA go as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Media industry. The net income has significantly decreased by 39.1% when compared to the same quarter one year ago, falling from -$18.11 million to -$25.18 million.
  • 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 Media industry and the overall market, RADIO ONE INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The debt-to-equity ratio is very high at 15.39 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Despite the company's weak debt-to-equity ratio, the company has managed to keep a very strong quick ratio of 2.68, which shows the ability to cover short-term cash needs.
  • The gross profit margin for RADIO ONE INC is rather high; currently it is at 68.24%. Regardless of ROIA's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ROIA's net profit margin of -22.67% significantly underperformed when compared to the industry average.
  • RADIO ONE INC's earnings per share declined by 39.5% 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, RADIO ONE INC continued to lose money by earning -$1.30 versus -$1.33 in the prior year.

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

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Liberty Interactive ( LINTB) was another company that pushed the Services sector lower today. Liberty Interactive was down $0.71 (2.5%) to $27.52 on heavy volume. Throughout the day, 2,500 shares of Liberty Interactive exchanged hands as compared to its average daily volume of 400 shares. The stock ranged in price between $27.52-$27.57 after having opened the day at $27.57 as compared to the previous trading day's close of $28.23.

Liberty Interactive has a market cap of $815.3 million and is part of the transportation industry. Shares are down 4.0% year-to-date as of the close of trading on Monday.

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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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3 Stocks Pushing The Diversified Services Industry Lower

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