3 Stocks Pushing The Health Care Sector Lower

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.

The Health Care sector as a whole closed the day down 0.2% versus the S&P 500, which was up 0.4%. Laggards within the Health Care sector included Reliv' International ( RELV), down 2.2%, Allied Healthcare Products ( AHPI), down 5.3%, Huttig Building Products ( HBP), down 3.8%, American Shared Hospital Services ( AMS), down 3.0% and VirtualScopics ( VSCP), down 4.5%.

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

VirtualScopics ( VSCP) is one of the companies that pushed the Health Care sector lower today. VirtualScopics was down $0.15 (4.5%) to $3.19 on light volume. Throughout the day, 3,500 shares of VirtualScopics exchanged hands as compared to its average daily volume of 10,400 shares. The stock ranged in price between $2.83-$3.34 after having opened the day at $2.83 as compared to the previous trading day's close of $3.34.

VirtualScopics, Inc. provides imaging solutions for the pharmaceutical, biotechnology, and medical device industries. VirtualScopics has a market cap of $9.8 million and is part of the drugs industry. Shares are up 5.3% year-to-date as of the close of trading on Friday. Currently there is 1 analyst who rates VirtualScopics a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates VirtualScopics as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on VSCP go as follows:

  • VIRTUALSCOPICS INC's earnings per share declined by 8.6% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, VIRTUALSCOPICS INC reported poor results of -$1.20 versus -$1.02 in the prior year.
  • The company, on the basis of change in net income from the same quarter one year ago, has underperformed when compared to that of the S&P 500 and greatly underperformed compared to the Life Sciences Tools & Services industry average. The net income has decreased by 7.2% when compared to the same quarter one year ago, dropping from -$1.02 million to -$1.09 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.
  • The gross profit margin for VIRTUALSCOPICS INC is currently lower than what is desirable, coming in at 27.17%. It has decreased significantly from the same period last year. Along with this, the net profit margin of -40.16% is significantly below that of the industry average.
  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, VSCP has underperformed the S&P 500 Index, declining 17.01% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.

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

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At the close, Allied Healthcare Products ( AHPI) was down $0.09 (5.3%) to $1.60 on light volume. Throughout the day, 8,225 shares of Allied Healthcare Products exchanged hands as compared to its average daily volume of 11,900 shares. The stock ranged in price between $1.58-$1.63 after having opened the day at $1.59 as compared to the previous trading day's close of $1.69.

Allied Healthcare Products, Inc. manufactures, markets, and distributes respiratory care products, medical gas equipment, and emergency medical products in Canada, Mexico, Central and South America, Europe, the Middle East, and the Far East. Allied Healthcare Products has a market cap of $13.0 million and is part of the drugs industry. Shares are down 8.2% year-to-date as of the close of trading on Friday.

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TheStreet Ratings rates Allied Healthcare Products as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on AHPI go as follows:

  • ALLIED HEALTHCARE PRODS INC's earnings per share declined by 28.6% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, ALLIED HEALTHCARE PRODS INC reported poor results of -$0.34 versus -$0.15 in the prior year.
  • 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 Health Care Equipment & Supplies industry. The net income has decreased by 19.8% when compared to the same quarter one year ago, dropping from -$0.59 million to -$0.71 million.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Health Care Equipment & Supplies industry and the overall market, ALLIED HEALTHCARE PRODS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for ALLIED HEALTHCARE PRODS INC is rather low; currently it is at 21.58%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -8.00% is significantly below that of the industry average.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 25.69%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 28.57% compared to the year-earlier 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.

You can view the full analysis from the report here: Allied Healthcare Products 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.

Reliv' International ( RELV) was another company that pushed the Health Care sector lower today. Reliv' International was down $0.02 (2.2%) to $1.10 on average volume. Throughout the day, 9,000 shares of Reliv' International exchanged hands as compared to its average daily volume of 9,400 shares. The stock ranged in price between $1.09-$1.13 after having opened the day at $1.13 as compared to the previous trading day's close of $1.13.

Reliv' International, Inc. develops, manufactures, and markets nutritional supplements that promote basic nutrition, weight loss, athletic performance, digestive health, women's health, anti-aging, and healthy energy. Reliv' International has a market cap of $14.2 million and is part of the drugs industry. Shares are down 3.4% year-to-date as of the close of trading on Friday.

TheStreet Ratings rates Reliv' International as a hold. The company's strengths can be seen in multiple areas, such as its increase in net income, attractive valuation levels and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including disappointing return on equity and a generally disappointing performance in the stock itself.

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Highlights from TheStreet Ratings analysis on RELV go as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Personal Products industry. The net income increased by 98.6% when compared to the same quarter one year prior, rising from $0.50 million to $1.00 million.
  • RELV's debt-to-equity ratio is very low at 0.21 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.91 is somewhat weak and could be cause for future problems.
  • RELV'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 51.31%, 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. Turning toward the future, the fact that the stock has come down in price over the past year should not necessarily be interpreted as a negative; it could be one of the factors that may help make the stock attractive down the road. Right now, however, we believe that it is too soon to buy.
  • 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 Personal Products industry and the overall market, RELIV INTERNATIONAL INC's return on equity significantly trails that of both the industry average and the S&P 500.

You can view the full analysis from the report here: Reliv' International 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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