3 Stocks Pushing The Diversified Services Industry Lower

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The Diversified Services industry as a whole closed the day down 1.2% versus the S&P 500, which was down 1.6%. Laggards within the Diversified Services industry included VirtualScopics ( VSCP), down 6.5%, Bioanalytical Systems ( BASI), down 3.3%, Onvia ( ONVI), down 1.5%, Birner Dental Management Services ( BDMS), down 1.8% and RLJ Entertainment ( RLJE), down 2.8%.

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

RLJ Entertainment ( RLJE) is one of the companies that pushed the Diversified Services industry lower today. RLJ Entertainment was down $0.10 (2.8%) to $3.52 on average volume. Throughout the day, 11,713 shares of RLJ Entertainment exchanged hands as compared to its average daily volume of 12,000 shares. The stock ranged in price between $3.50-$3.63 after having opened the day at $3.60 as compared to the previous trading day's close of $3.62.

RLJ Entertainment, Inc., an entertainment company, acquires content rights in British episodic mystery and drama, urban programming, and full-length motion pictures. It operates through three segments: Intellectual Property Licensing, Wholesale, and Direct-to-Consumer. RLJ Entertainment has a market cap of $48.3 million and is part of the services sector. Shares are down 24.4% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates RLJ Entertainment as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on RLJE 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 Media industry and the overall market, RLJ ENTERTAINMENT INC'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 $0.17 million or 97.99% 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 RLJ ENTERTAINMENT INC is currently lower than what is desirable, coming in at 30.90%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, RLJE's net profit margin of -7.10% significantly underperformed when compared to the industry average.
  • RLJE's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 46.54%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • RLJ ENTERTAINMENT INC reported significant earnings per share improvement 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, RLJ ENTERTAINMENT INC reported poor results of -$2.30 versus -$0.49 in the prior year.

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

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At the close, Bioanalytical Systems ( BASI) was down $0.08 (3.3%) to $2.32 on light volume. Throughout the day, 720 shares of Bioanalytical Systems exchanged hands as compared to its average daily volume of 11,500 shares. The stock ranged in price between $2.32-$2.40 after having opened the day at $2.40 as compared to the previous trading day's close of $2.40.

Bioanalytical Systems, Inc. provides drug discovery and development services, and analytical instruments for pharmaceutical, biotechnology, academic, and government organizations in North America, the Pacific Rim, Europe, and internationally. Bioanalytical Systems has a market cap of $20.3 million and is part of the services sector. Shares are down 11.4% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Bioanalytical Systems as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income and weak operating cash flow.

Highlights from TheStreet Ratings analysis on BASI go as follows:

  • 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 Life Sciences Tools & Services industry. The net income has significantly decreased by 62.7% when compared to the same quarter one year ago, falling from $0.58 million to $0.22 million.
  • Net operating cash flow has significantly decreased to $0.21 million or 75.43% 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's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Life Sciences Tools & Services industry and the overall market, BIOANALYTICAL SYSTEMS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • BIOANALYTICAL SYSTEMS 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. 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, BIOANALYTICAL SYSTEMS INC turned its bottom line around by earning $0.09 versus -$0.87 in the prior year.
  • 39.46% is the gross profit margin for BIOANALYTICAL SYSTEMS INC which we consider to be strong. Regardless of BASI's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 3.56% trails the industry average.

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

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VirtualScopics ( VSCP) was another company that pushed the Diversified Services industry lower today. VirtualScopics was down $0.31 (6.5%) to $4.46 on average volume. Throughout the day, 2,800 shares of VirtualScopics exchanged hands as compared to its average daily volume of 3,700 shares. The stock ranged in price between $4.46-$4.59 after having opened the day at $4.59 as compared to the previous trading day's close of $4.77.

VirtualScopics, Inc. provides imaging solutions for the pharmaceutical, biotechnology, and medical device industries. VirtualScopics has a market cap of $13.4 million and is part of the services sector. Shares are up 37.9% year-to-date as of the close of trading on Wednesday. Currently there is 1 analyst who rates VirtualScopics a buy, no analysts rate it a sell, and none rate it a hold.

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

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Highlights from TheStreet Ratings analysis on VSCP go as follows:

  • 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 Life Sciences Tools & Services industry. The net income has significantly decreased by 646.3% when compared to the same quarter one year ago, falling from $0.13 million to -$0.73 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 Life Sciences Tools & Services industry and the overall market, VIRTUALSCOPICS INC'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 -$1.16 million or 716.90% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • This stock has managed to decline in share value by 5.00% over the past twelve months. 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.
  • The revenue fell significantly faster than the industry average of 21.7%. Since the same quarter one year prior, revenues fell by 28.5%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.

You can view the full analysis from the report here: VirtualScopics 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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