3 Stocks Pushing The Internet Industry Lower

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The Internet industry as a whole closed the day down 1.0% versus the S&P 500, which was unchanged. Laggards within the Internet industry included Professional Diversity Network ( IPDN), down 1.7%, Internet Initiative Japan ( IIJI), down 1.7%, Innodata ( INOD), down 1.6%, CafePress ( PRSS), down 3.1% and ChinaNet Online Holdings ( CNET), down 8.0%.

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

Innodata ( INOD) is one of the companies that pushed the Internet industry lower today. Innodata was down $0.05 (1.6%) to $3.09 on average volume. Throughout the day, 16,564 shares of Innodata exchanged hands as compared to its average daily volume of 18,800 shares. The stock ranged in price between $3.03-$3.18 after having opened the day at $3.09 as compared to the previous trading day's close of $3.14.

Innodata Inc. provides business process, information technology, and professional services that are focused on digital enablement. The company operates in two segments, Content Services (CS) and Innodata Advanced Data Solutions (IADS). Innodata has a market cap of $79.1 million and is part of the technology sector. Shares are up 28.2% year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate Innodata a buy, no analysts rate it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Innodata as a hold. Among the primary strengths of the company is its solid stock price performance. At the same time, however, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from TheStreet Ratings analysis on INOD go as follows:

  • This stock has managed to rise its share value by 21.53% over the past twelve months. Looking ahead, our view is that this company's fundamentals will not have much impact in either direction, allowing the stock to generally move up or down based on the push and pull of the broad market.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 12.2%. Since the same quarter one year prior, revenues fell by 11.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • INNODATA INC'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. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, INNODATA INC swung to a loss, reporting -$0.43 versus $0.29 in the prior year. This year, the market expects an improvement in earnings (-$0.01 versus -$0.43).
  • 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 IT Services industry and the overall market, INNODATA INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for INNODATA INC is rather low; currently it is at 20.92%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -4.63% is significantly below that of the industry average.

You can view the full analysis from the report here: Innodata 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.

At the close, Internet Initiative Japan ( IIJI) was down $0.18 (1.7%) to $10.49 on light volume. Throughout the day, 1,814 shares of Internet Initiative Japan exchanged hands as compared to its average daily volume of 4,500 shares. The stock ranged in price between $10.49-$10.52 after having opened the day at $10.50 as compared to the previous trading day's close of $10.67.

Internet Initiative Japan Inc., together with its subsidiaries, offers Internet connectivity, WAN, outsourcing, and systems integration services primarily in Japan. The company operates in two segments: Network Services and Systems Integration Business, and ATM Operation Business. Internet Initiative Japan has a market cap of $1.0 billion and is part of the technology sector. Shares are down 20.2% year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate Internet Initiative Japan a buy, no analysts rate it a sell, and 1 rates it a hold.

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

TheStreet Ratings rates Internet Initiative Japan as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including a generally disappointing performance in the stock itself, feeble growth in the company's earnings per share and deteriorating net income.

Highlights from TheStreet Ratings analysis on IIJI go as follows:

  • IIJI's revenue growth trails the industry average of 19.9%. Since the same quarter one year prior, revenues slightly increased by 2.1%. 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.
  • Despite currently having a low debt-to-equity ratio of 0.31, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 1.20 is sturdy.
  • 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 Internet Software & Services industry. The net income has significantly decreased by 49.6% when compared to the same quarter one year ago, falling from $9.61 million to $4.85 million.
  • The gross profit margin for INTERNET INITIATIVE JAPAN INC is currently lower than what is desirable, coming in at 26.53%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of 1.78% significantly trails the industry average.

You can view the full analysis from the report here: Internet Initiative Japan 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.

Professional Diversity Network ( IPDN) was another company that pushed the Internet industry lower today. Professional Diversity Network was down $0.10 (1.7%) to $5.37 on light volume. Throughout the day, 4,140 shares of Professional Diversity Network exchanged hands as compared to its average daily volume of 6,100 shares. The stock ranged in price between $5.30-$5.40 after having opened the day at $5.30 as compared to the previous trading day's close of $5.46.

Professional Diversity Network, Inc. operates online professional networking communities with career resources in the United States. Professional Diversity Network has a market cap of $34.5 million and is part of the technology sector. Shares are up 18.6% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates Professional Diversity Network a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Professional Diversity Network as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and weak operating cash flow.

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 IPDN 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 Internet Software & Services industry and the overall market, PROFESSIONAL DIVERSITY NETWK'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 -$0.35 million or 138.51% 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 gross profit margin for PROFESSIONAL DIVERSITY NETWK is currently very high, coming in at 70.44%. Regardless of IPDN's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, IPDN's net profit margin of -21.24% significantly underperformed when compared to the industry average.
  • 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. Regardless of the rise in share value over the previous year, we feel that the risks involved in investing in this stock do not compensate for any future upside potential.
  • PROFESSIONAL DIVERSITY NETWK reported significant earnings per share improvement 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, PROFESSIONAL DIVERSITY NETWK swung to a loss, reporting -$0.23 versus $0.27 in the prior year. This year, the market expects an improvement in earnings (-$0.19 versus -$0.23).

You can view the full analysis from the report here: Professional Diversity Network 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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