3 Stocks Pushing The Diversified Services Industry Lower

The Diversified Services industry as a whole closed the day down 1.0% versus the S&P 500, which was down 0.2%. Laggards within the Diversified Services industry included VirtualScopics ( VSCP), down 1.7%, Document Security Systems ( DSS), down 4.7%, Amrep ( AXR), down 2.1%, ATRM Holdings ( ATRM), down 5.8% and MGT Capital Investments ( MGT), down 10.9%.

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

Amrep ( AXR) is one of the companies that pushed the Diversified Services industry lower today. Amrep was down $0.11 (2.1%) to $5.07 on light volume. Throughout the day, 100 shares of Amrep exchanged hands as compared to its average daily volume of 2,700 shares. The stock ranged in price between $5.07-$5.07 after having opened the day at $5.07 as compared to the previous trading day's close of $5.18.

AMREP Corporation, through its subsidiaries, provides real estate and fulfillment services. It operates through two segments, Fulfillment Services and Real Estate Operations. Amrep has a market cap of $40.4 million and is part of the services sector. Shares are up 34.9% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates Amrep as a sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself and poor profit margins.

Highlights from TheStreet Ratings analysis on AXR go as follows:

  • Reflecting the weaknesses we have cited, including the decline in the company's earnings per share, AXR has underperformed the S&P 500 Index, declining 17.03% 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.
  • The gross profit margin for AMREP CORP is rather low; currently it is at 19.00%. Regardless of AXR's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 1.45% trails the industry average.
  • 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 Commercial Services & Supplies industry and the overall market, AMREP CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • AMREP CORP's earnings per share declined by 25.0% 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, AMREP CORP continued to lose money by earning -$0.43 versus -$0.47 in the prior year.
  • AXR, with its decline in revenue, underperformed when compared the industry average of 5.3%. Since the same quarter one year prior, revenues fell by 20.6%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

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

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At the close, Document Security Systems ( DSS) was down $0.01 (4.7%) to $0.18 on light volume. Throughout the day, 43,880 shares of Document Security Systems exchanged hands as compared to its average daily volume of 62,300 shares. The stock ranged in price between $0.17-$0.19 after having opened the day at $0.17 as compared to the previous trading day's close of $0.19.

Document Security Systems, Inc., through its subsidiaries, develops, manufactures, markets, and sells paper and plastic products to protect information from unauthorized scanning, copying, and digital imaging in the United States and internationally. Document Security Systems has a market cap of $8.8 million and is part of the services sector. Shares are down 58.0% year-to-date as of the close of trading on Monday. Currently there is 1 analyst who rates Document Security Systems a buy, no analysts rate it a sell, and none rate it a hold.

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

Highlights from TheStreet Ratings analysis on DSS 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 Software industry and the overall market, DOCUMENT SECURITY SYS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has declined marginally to -$0.53 million or 8.40% when compared to the same quarter last year. Despite a decrease in cash flow DOCUMENT SECURITY SYS INC is still fairing well by exceeding its industry average cash flow growth rate of -27.97%.
  • DSS'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 86.16%, 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.
  • DOCUMENT SECURITY SYS INC has improved earnings per share by 42.9% 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, DOCUMENT SECURITY SYS INC swung to a loss, reporting -$0.98 versus $0.04 in the prior year.
  • Despite currently having a low debt-to-equity ratio of 0.55, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.92 is weak.

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

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VirtualScopics ( VSCP) was another company that pushed the Diversified Services industry lower today. VirtualScopics was down $0.04 (1.7%) to $2.26 on average volume. Throughout the day, 5,730 shares of VirtualScopics exchanged hands as compared to its average daily volume of 4,600 shares. The stock ranged in price between $2.02-$2.30 after having opened the day at $2.16 as compared to the previous trading day's close of $2.30.

VirtualScopics, Inc. provides imaging solutions to the pharmaceutical, biotechnology, and medical device industries. VirtualScopics has a market cap of $7.3 million and is part of the services sector. Shares are down 27.5% 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, 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.
  • The gross profit margin for VIRTUALSCOPICS INC is currently lower than what is desirable, coming in at 33.41%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -18.11% is significantly below that of 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 33.69%, 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 25.3% when compared to the same quarter one year prior, rising from -$0.73 million to -$0.55 million.
  • VIRTUALSCOPICS INC has improved earnings per share by 23.1% 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, VIRTUALSCOPICS INC reported poor results of -$1.20 versus -$1.02 in the prior year.

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

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