3 Stocks Pushing The Diversified Services Industry Lower

The Diversified Services industry as a whole closed the day up 0.5% versus the S&P 500, which was up 0.2%. Laggards within the Diversified Services industry included Compx International ( CIX), down 2.6%, VirtualScopics ( VSCP), down 2.8%, Industrial Services of America ( IDSA), down 4.1%, MGT Capital Investments ( MGT), down 6.1% and China Yida ( CNYD), down 2.0%.

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

Industrial Services of America ( IDSA) is one of the companies that pushed the Diversified Services industry lower today. Industrial Services of America was down $0.16 (4.1%) to $3.73 on light volume. Throughout the day, 224 shares of Industrial Services of America exchanged hands as compared to its average daily volume of 3,000 shares. The stock ranged in price between $3.71-$3.73 after having opened the day at $3.71 as compared to the previous trading day's close of $3.89.

Industrial Services of America, Inc. operates as a recycler of stainless steel, ferrous, and non-ferrous scrap in the United States and Canada. It operates in two segments, Recycling and Waste Services. Industrial Services of America has a market cap of $31.9 million and is part of the basic materials sector. Shares are down 34.8% year-to-date as of the close of trading on Thursday.

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TheStreet Ratings rates Industrial Services of America as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on IDSA 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 Commercial Services & Supplies industry. The net income has significantly decreased by 380.8% when compared to the same quarter one year ago, falling from -$0.65 million to -$3.10 million.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 38.52%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 333.33% 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.
  • 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 Commercial Services & Supplies industry and the overall market, INDUSTRIAL SERVICES AMER INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • INDUSTRIAL SERVICES AMER 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, INDUSTRIAL SERVICES AMER INC continued to lose money by earning -$0.97 versus -$1.96 in the prior year.
  • IDSA, with its decline in revenue, underperformed when compared the industry average of 5.2%. Since the same quarter one year prior, revenues fell by 29.1%. 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: Industrial Services of America Ratings Report

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At the close, VirtualScopics ( VSCP) was down $0.07 (2.8%) to $2.43 on light volume. Throughout the day, 1,919 shares of VirtualScopics exchanged hands as compared to its average daily volume of 4,600 shares. The stock ranged in price between $2.26-$2.45 after having opened the day at $2.30 as compared to the previous trading day's close of $2.50.

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 basic materials sector. Shares are down 21.2% year-to-date as of the close of trading on Thursday. 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 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 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 41.18%, 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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Compx International ( CIX) was another company that pushed the Diversified Services industry lower today. Compx International was down $0.30 (2.6%) to $11.07 on heavy volume. Throughout the day, 2,029,250 shares of Compx International exchanged hands as compared to its average daily volume of 700 shares. The stock ranged in price between $11.07-$11.07 after having opened the day at $11.07 as compared to the previous trading day's close of $11.37.

CompX International Inc. engages in the manufacture and sale of security products and recreational marine components primarily in North America. The company operates through two segments, Security Products and Marine Components. Compx International has a market cap of $27.4 million and is part of the basic materials sector. Shares are down 6.0% year-to-date as of the close of trading on Thursday.

TheStreet Ratings rates Compx International as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, growth in earnings per share and increase in net income. We feel its strengths outweigh the fact that the company shows weak operating cash flow.

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Highlights from TheStreet Ratings analysis on CIX go as follows:

  • The revenue growth came in higher than the industry average of 5.2%. Since the same quarter one year prior, revenues slightly increased by 8.2%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • CIX has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 5.13, which clearly demonstrates the ability to cover short-term cash needs.
  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • COMPX INTERNATIONAL INC has improved earnings per share by 11.8% 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. During the past fiscal year, COMPX INTERNATIONAL INC increased its bottom line by earning $0.70 versus $0.49 in the prior year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Commercial Services & Supplies industry. The net income increased by 12.8% when compared to the same quarter one year prior, going from $2.14 million to $2.41 million.

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

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