3 Stocks Pushing The Telecommunications Industry Lower

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The Telecommunications industry as a whole closed the day down 0.8% versus the S&P 500, which was down 0.7%. Laggards within the Telecommunications industry included Sajan ( SAJA), down 8.3%, Maxcom Telecomunicaciones SAB de CV ( MXT), down 6.5%, Voltari ( VLTC), down 4.4%, B Communications ( BCOM), down 1.9% and RIT Technologies ( RITT), down 6.7%.

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

B Communications ( BCOM) is one of the companies that pushed the Telecommunications industry lower today. B Communications was down $0.40 (1.9%) to $20.10 on heavy volume. Throughout the day, 39,372 shares of B Communications exchanged hands as compared to its average daily volume of 2,600 shares. The stock ranged in price between $19.40-$20.85 after having opened the day at $20.14 as compared to the previous trading day's close of $20.50.

B Communications Ltd. provides various communications services in Israel. B Communications has a market cap of $602.3 million and is part of the technology sector. Shares are up 15.1% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates B Communications as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity and attractive valuation levels. 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 BCOM go as follows:

  • BCOM's revenue growth has slightly outpaced the industry average of 1.4%. Since the same quarter one year prior, revenues slightly increased by 3.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 2751.61% and other important driving factors, this stock has surged by 53.44% 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.
  • 43.72% is the gross profit margin for B COMMUNICATIONS LTD which we consider to be strong. Regardless of BCOM's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, BCOM's net profit margin of 39.34% significantly outperformed against the industry.
  • The debt-to-equity ratio is very high at 14.29 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, BCOM maintains a poor quick ratio of 0.82, which illustrates the inability to avoid short-term cash problems.

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

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