3 Stocks Pushing The Diversified Services Industry Lower

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The Diversified Services industry as a whole closed the day down 0.2% versus the S&P 500, which was up 0.7%. Laggards within the Diversified Services industry included General Employment ( JOB), down 7.0%, Wilhelmina International ( WHLMD), down 5.8%, Wilhelmina International ( WHLM), down 5.8%, Bioanalytical Systems ( BASI), down 2.5% and Onvia ( ONVI), down 1.6%.

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

Barrett Business Services ( BBSI) is one of the companies that pushed the Diversified Services industry lower today. Barrett Business Services was down $8.95 (15.5%) to $48.69 on heavy volume. Throughout the day, 993,969 shares of Barrett Business Services exchanged hands as compared to its average daily volume of 76,900 shares. The stock ranged in price between $43.88-$57.33 after having opened the day at $57.29 as compared to the previous trading day's close of $57.64.

Barrett Business Services, Inc. provides business management solutions for small and medium-sized companies in the United States. Barrett Business Services has a market cap of $412.1 million and is part of the services sector. Shares are down 38.1% year-to-date as of the close of trading on Monday. Currently there are 2 analysts who rate Barrett Business Services a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Barrett Business Services as a buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, robust revenue growth, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from TheStreet Ratings analysis on BBSI go as follows:

  • BARRETT BUSINESS SVCS INC has improved earnings per share by 22.5% 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, BARRETT BUSINESS SVCS INC increased its bottom line by earning $2.39 versus $1.92 in the prior year. This year, the market expects an improvement in earnings ($3.05 versus $2.39).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Professional Services industry. The net income increased by 23.7% when compared to the same quarter one year prior, going from $5.89 million to $7.28 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 20.9%. Since the same quarter one year prior, revenues rose by 17.3%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • BBSI's debt-to-equity ratio is very low at 0.07 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.12, which illustrates the ability to avoid short-term cash problems.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Professional Services industry and the overall market, BARRETT BUSINESS SVCS INC's return on equity significantly exceeds that of both the industry average and the S&P 500.

You can view the full analysis from the report here: Barrett Business Services Ratings Report

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