Nuance Communications Inc. (NUAN): Today's Featured Technology Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Nuance Communications (NUAN) pushed the Technology sector lower today making it today's featured Technology laggard. The sector as a whole was unchanged today. By the end of trading, Nuance Communications fell 23 cents (-1%) to $22.11 on light volume. Throughout the day, 1.9 million shares of Nuance Communications exchanged hands as compared to its average daily volume of 3.3 million shares. The stock ranged in price between $21.84-$22.38 after having opened the day at $22.37 as compared to the previous trading day's close of $22.34. Other companies within the Technology sector that declined today were: Avid Technology (AVID), down 18.1%, Spire Corporation (SPIR), down 15.3%, Wireless Ronin Technologies (RNIN), down 14.5%, and China Mobile Games and Entertainment Group (CMGE), down 13.3%.

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Nuance Communications, Inc. provides voice and language solutions for businesses and consumers worldwide. Nuance Communications has a market cap of $6.94 billion and is part of the computer software & services industry. The company has a P/E ratio of 86.7, equal to the average computer software & services industry P/E ratio and above the S&P 500 P/E ratio of 17.7. Shares are down 11.2% year to date as of the close of trading on Friday. Currently there are 14 analysts that rate Nuance Communications a buy, one analyst rates it a sell, and two rate it a hold.

TheStreet Ratings rates Nuance Communications as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, impressive record of earnings per share growth, compelling growth in net income, good cash flow from operations and expanding profit margins. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself.

• You can view the full Nuance Ratings Report.

On the positive front, A123 Systems (AONE), up 53.9%, SatCon Technology Corporation (SATC), up 42.3%, LDK Solar Company (LDK), up 21.1%, and Kingtone Wirelessinfo Solution (KONE), up 17.9%, were all gainers within the technology sector with Seagate Technology (STX) being today's featured technology sector leader.

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For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the technology sector could consider Technology Select Sector SPDR (XLK) while those bearish on the technology sector could consider ProShares Ultra Short Technology (REW).

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