3 Stocks Pushing The Diversified Services Industry 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 Diversified Services industry as a whole closed the day down 0.2% versus the S&P 500, which was down 0.2%. Laggards within the Diversified Services industry included SmartPros ( SPRO), down 2.6%, VirtualScopics ( VSCP), down 2.1%, Bioanalytical Systems ( BASI), down 3.5%, ATRM Holdings ( ATRM), down 5.9% and Birner Dental Management Services ( BDMS), down 3.5%.

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

ATRM Holdings ( ATRM) is one of the companies that pushed the Diversified Services industry lower today. ATRM Holdings was down $0.20 (5.9%) to $3.20 on average volume. Throughout the day, 5,874 shares of ATRM Holdings exchanged hands as compared to its average daily volume of 6,000 shares. The stock ranged in price between $3.10-$3.39 after having opened the day at $3.39 as compared to the previous trading day's close of $3.40.

ATRM Holdings, Inc., through its subsidiary, KBS Builders, Inc., manufactures, sells, and distributes modular buildings for commercial and residential applications in the New England states. ATRM Holdings has a market cap of $3.8 million and is part of the technology sector. Shares are up 16.8% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates ATRM Holdings 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, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on ATRM go as follows:

  • ATRM HOLDINGS 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. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, ATRM HOLDINGS INC reported poor results of -$8.33 versus -$1.99 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 Semiconductors & Semiconductor Equipment industry. The net income has significantly decreased by 657.6% when compared to the same quarter one year ago, falling from -$0.20 million to -$1.49 million.
  • Net operating cash flow has significantly decreased to -$3.02 million or 575.74% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 25.40%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 160.41% 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: ATRM Holdings Ratings Report

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At the close, Bioanalytical Systems ( BASI) was down $0.05 (3.5%) to $1.37 on heavy volume. Throughout the day, 20,630 shares of Bioanalytical Systems exchanged hands as compared to its average daily volume of 12,200 shares. The stock ranged in price between $1.29-$1.37 after having opened the day at $1.34 as compared to the previous trading day's close of $1.42.

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 $11.9 million and is part of the technology sector. Shares are down 34.9% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates Bioanalytical Systems as a sell. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on BASI go as follows:

  • BASI'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 35.53%, 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.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. 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 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, BIOANALYTICAL SYSTEMS INC swung to a loss, reporting -$0.15 versus $0.09 in the prior year.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 5.1%. Since the same quarter one year prior, revenues slightly dropped by 3.1%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • 37.64% 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 2.61% 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 $0.05 (2.1%) to $2.33 on light volume. Throughout the day, 350 shares of VirtualScopics exchanged hands as compared to its average daily volume of 5,200 shares. The stock ranged in price between $2.31-$2.33 after having opened the day at $2.31 as compared to the previous trading day's close of $2.38.

VirtualScopics, Inc. provides imaging solutions to the pharmaceutical, biotechnology, and medical device industries. VirtualScopics has a market cap of $7.0 million and is part of the technology sector. Shares are down 24.9% year-to-date as of the close of trading on Monday. 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 disappointing return on equity, weak operating cash flow, poor profit margins and generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on VSCP 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 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 -$1.55 million or 273.31% 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 VIRTUALSCOPICS INC is currently lower than what is desirable, coming in at 34.61%. Regardless of VSCP's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, VSCP's net profit margin of -19.65% significantly underperformed when compared to the industry average.
  • VSCP'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 43.63%, 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.
  • The company, on the basis of net income growth from the same quarter one year ago, has significantly underperformed compared to the Life Sciences Tools & Services industry average, but is greater than that of the S&P 500. The net income increased by 14.4% when compared to the same quarter one year prior, going from -$0.65 million to -$0.55 million.

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

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