3 Stocks Driving The Computer Software & Services Industry Higher - TheStreet

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

All three major indices traded up today with the

Dow Jones Industrial Average

(

^DJI

) trading up 188 points (1.1%) at 17,006 as of Tuesday, Oct. 28, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 2,601 issues advancing vs. 503 declining with 115 unchanged.

The Computer Software & Services industry as a whole closed the day up 2.6% versus the S&P 500, which was up 1.2%. Top gainers within the Computer Software & Services industry included

CollabRx

(

CLRX

), up 8.7%,

Astea International

(

ATEA

), up 2.6%,

Intelligent Systems

(

INS

), up 3.4%,

CounterPath

(

CPAH

), up 16.9% and

GSE Systems

(

GVP

), up 6.1%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the industry higher today:

GSE Systems

(

GVP

) is one of the companies that pushed the Computer Software & Services industry higher today. GSE Systems was up $0.09 (6.1%) to $1.56 on average volume. Throughout the day, 42,455 shares of GSE Systems exchanged hands as compared to its average daily volume of 30,300 shares. The stock ranged in a price between $1.40-$1.59 after having opened the day at $1.40 as compared to the previous trading day's close of $1.47.

GSE Systems, Inc. provides simulation, educational, and engineering solutions and services to the nuclear and fossil electric utility industry, and the chemical and petrochemical industries worldwide. GSE Systems has a market cap of $26.7 million and is part of the technology sector. Shares are down 6.9% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate GSE Systems a buy, no analysts rate it a sell, and none rate it a hold.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreet Ratings rates GSE Systems as a

sell

. The company's weaknesses can be seen in multiple areas, such as its weak operating cash flow, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on GVP go as follows:

  • Net operating cash flow has significantly decreased to -$2.32 million or 160.43% 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 GSE SYSTEMS INC is currently lower than what is desirable, coming in at 32.75%. Regardless of GVP's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, GVP's net profit margin of -23.99% significantly underperformed when compared to the industry average.
  • GVP has underperformed the S&P 500 Index, declining 12.36% 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.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. Compared to other companies in the Software industry and the overall market, GSE SYSTEMS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • GSE SYSTEMS INC reported significant earnings per share improvement 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, GSE SYSTEMS INC swung to a loss, reporting -$0.58 versus $0.06 in the prior year.

You can view the full analysis from the report here:

GSE Systems Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

At the close,

CounterPath

(

CPAH

) was up $0.15 (16.9%) to $1.04 on heavy volume. Throughout the day, 144,539 shares of CounterPath exchanged hands as compared to its average daily volume of 49,100 shares. The stock ranged in a price between $0.88-$1.06 after having opened the day at $0.94 as compared to the previous trading day's close of $0.89.

CounterPath has a market cap of $39.6 million and is part of the technology sector. Shares are down 13.1% year-to-date as of the close of trading on Monday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

CollabRx

(

CLRX

) was another company that pushed the Computer Software & Services industry higher today. CollabRx was up $0.06 (8.7%) to $0.75 on average volume. Throughout the day, 16,627 shares of CollabRx exchanged hands as compared to its average daily volume of 18,400 shares. The stock ranged in a price between $0.67-$0.75 after having opened the day at $0.67 as compared to the previous trading day's close of $0.69.

CollabRx, Inc. provides cloud-based expert systems to inform healthcare decision-making. The company's cloud-based expert systems provide clinical knowledge to institutions, physicians, researchers, and patients for genomics-based medicine in cancer. CollabRx has a market cap of $2.1 million and is part of the technology sector. Shares are down 81.5% year-to-date as of the close of trading on Monday. Currently there is 1 analyst who rates CollabRx a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates CollabRx as a

sell

. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from TheStreet Ratings analysis on CLRX 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 Health Care Technology industry. The net income has significantly decreased by 56.6% when compared to the same quarter one year ago, falling from -$0.80 million to -$1.25 million.
  • 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 Health Care Technology industry and the overall market, COLLABRX INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to -$0.73 million or 19.96% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 83.56%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 74.28% 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.
  • COLLABRX 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 reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, COLLABRX INC continued to lose money by earning -$1.78 versus -$2.15 in the prior year. For the next year, the market is expecting a contraction of 3.9% in earnings (-$1.85 versus -$1.78).

You can view the full analysis from the report here:

CollabRx Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.