Hawkins, NCI: Top 5 Small-Cap Stocks

The First of Long Island(FLIC) is a commercial bank in New York.

The numbers: Second-quarter profit increased 3% to $3.4 million, or 47 cents a share, as revenue grew 13% to $18 million. Its gross margin was little changed at 73% and its operating margin declined from 35% to 34%. The company is adequately capitalized, evident in its risk-based capital ratio of 17%. A debt-to-equity ratio of 1.5 indicates higher-than-ideal leverage.

The stock: The First of Long Island has increased 12% this year, beating the Dow Jones Industrial Average, but trailing the S&P 500 Index. The stock trades at a price-to-earnings ratio of 14, a discount to the market and regional banking peers. Shares pay a 2.7% dividend yield.

NCI(NCIT) provides technology consulting to government agencies.

The numbers: Second-quarter profit rose 26% to $5.1 million, or 37 cents a share, as revenue advanced 13% to $109 million. Its gross margin declined from 14% to 13% and its operating margin rose from 8% to 9%. A quick ratio of 1.6 demonstrates ample liquidity and a debt-to-equity ratio of 0.2 indicates modest leverage.

The stock: NCI is down 2% this year, lagging behind major U.S. indices. The stock trades at a price-to-earnings ratio of 21, a premium to the market, but a discount to tech consulting peers. The company does not pay dividends.

Bio-Reference Laboratories(BRLI) provides testing services in the New York area.

The numbers: Fiscal third-quarter profit increased 36% to $6.4 million, or 46 cents a share, as revenue grew 25% to $97 million. Its gross margin remained steady at 52% and its operating margin climbed from 11% to 12%. A quick ratio of 2 demonstrates ample liquidity. A debt-to-equity ratio of 0.3 indicates modest leverage.

The stock: Bio-Reference is up 22% this year, outpacing the Dow and S&P 500. The stock trades at a price-to-earnings ratio of 22, a premium to the market and health care service peers. The company doesn't pay dividends.

TSC Ratings was given an award this year for "Best Stock Selection" among independent research providers by BNY ConvergEx Group. A rating can be viewed for any stock through our screener. Ratings are derived from a variety of fundamental and pricing figures and represent our opinion of risk-adjusted performance. However, the rating doesn't incorporate all factors that can alter a stock's performance.

-- Reported by Jake Lynch in Boston.

>To order reprints of this article, click here: Reprints