For Immediate ReleaseChicago, IL – May 17, 2018 – Today, Zacks Equity Research discusses the Industry: Business Services, Part 3, including First Data Corp. FDC, Everi Holdings EVRI, Healthcare Services Group HCSG and Fang Holdings Ltd. SFUN.Industry: Business Services, Part 3Link: https://www.zacks.com/commentary/162640/rising-costs-competition-pose-threats-to-business-servicesIn spite of the fact that the business services industry is riding high on a favorable economic and industrial backdrop, there are certain tailwinds weighing on its growth.Here we discuss some inherent challenges faced by the Business Services industry:High CostsPlayers in the business services industry need to continuously adopt to changing technology and hence, a considerable portion of their earnings goes into research and development. The performance of these providers can be hampered if they do not acclimatize to or adopt new services to cope with the latest developments.Furthermore, higher labor costs due to a competitive labor market are expected to continue to keep profits under pressure. The industry needs to have a more skilled workforce to take advantage of technology that develops at a rapid pace. The training of unskilled workers or taking in new skilled workers increases operational costs, in turn affecting margins.High CompetitionThe main business of one company can be a business service for another. So target customers for both may at times be the same. Thus, maintaining or increasing market share remains challenging for business service providers. Strategic mergers and consolidations also pose competition for players.Therefore, a business service provider needs to be adequately equipped to win over customers. While larger providers bank on the broad variety of service offerings and can effectively take up difficult ventures, relatively smaller players compete in an industry backed by specialized services.Regulatory HurdlesBy virtue of having operations across the globe, service providers face regulatory hurdles and compliance-related issues. Particularly, transaction processing companies like First Data Corp. and Everi Holdings are vulnerable to increasing global regulation, including anti-money laundering requirements and prohibition on certain types of Internet gambling payments.Stocks to AvoidTaking an unfavorable Zacks Rank into consideration, we prefer to avoid Healthcare Services Group and Fang Holdings Ltd., each carrying Zacks Rank #5 (Strong Sell).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.To ConcludeThe dearth of skilled labor in the business services industry can curtail its prospects. Non-availability of quality workforce at a reasonable rate might increase overall operational costs.In addition, the highly fragmented nature of the industry makes it difficult for such companies to set a distinct trend or predict a concrete future for it.In “Improving Economy to Fuel Business Services Growth in 2018,” we focus on the conditions that are expected to drive the industry forward.The Hottest Tech Mega-Trend of AllLast year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.See Zacks' 3 Best Stocks to Play This Trend >>Strong Stocks that Should Be in the NewsMany are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has nearly tripled the market from 1988 through 2015. Its average gain has been a stellar +26% per year.See these high-potential stocks free >>.Follow us on Twitter: https://twitter.com/zacksresearch!function(d,s,id){var js,fjs=d.getElementsByTagName(s)[0],p=/^http:/.test(d.location)?'http':'https';if(!d.getElementById(id)){js=d.createElement(s);js.id=id;js.src=p+"://platform.twitter.com/widgets.js";fjs.parentNode.insertBefore(js,fjs);}}(document,"script","twitter-wjs");Join us on Facebook: https://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=tsZacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.Media ContactZacks Investment Research800-767-3771 ext. 9339support@zacks.comhttps://www.zacks.com/Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report SouFun Holdings Limited (SFUN): Free Stock Analysis Report Healthcare Services Group, Inc. (HCSG): Free Stock Analysis Report First Data Corporation (FDC): Free Stock Analysis Report Everi Holdings Inc. (EVRI): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research