The Computer Hardware industry as a whole closed the day down 2.8% versus the S&P 500, which was down 1.3%. Laggards within the Computer Hardware industry included

Interphase

(

INPH

), down 8.2%,

Echelon

(

ELON

), down 6.0%,

Astro-Med

(

ALOT

), down 1.7%,

Crossroads Systems

(

CRDS

), down 8.7% and

Mad Catz Interactive

(

MCZ

), down 2.0%.

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

Crossroads Systems

(

CRDS

) is one of the companies that pushed the Computer Hardware industry lower today. Crossroads Systems was down $0.10 (8.7%) to $1.01 on average volume. Throughout the day, 75,407 shares of Crossroads Systems exchanged hands as compared to its average daily volume of 76,800 shares. The stock ranged in price between $1.01-$1.15 after having opened the day at $1.15 as compared to the previous trading day's close of $1.11.

Crossroads Systems, Inc. provides data protection solutions and services worldwide. Crossroads Systems has a market cap of $20.6 million and is part of the technology sector. Shares are down 55.6% year-to-date as of the close of trading on Wednesday. Currently there are 2 analysts who rate Crossroads Systems a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates

Crossroads Systems

as a

sell

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

Highlights from TheStreet Ratings analysis on CRDS 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 Computers & Peripherals industry. The net income has significantly decreased by 102.0% when compared to the same quarter one year ago, falling from -$1.74 million to -$3.52 million.
  • The debt-to-equity ratio is very high at 4.41 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Along with the unfavorable debt-to-equity ratio, CRDS maintains a poor quick ratio of 0.98, which illustrates the inability to avoid short-term cash problems.
  • 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 Computers & Peripherals industry and the overall market, CROSSROADS SYSTEMS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$2.28 million or 81.47% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much 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 58.08%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 35.71% 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.

You can view the full analysis from the report here:

Crossroads Systems Ratings Report

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At the close,

Echelon

(

ELON

) was down $0.03 (6.0%) to $0.55 on average volume. Throughout the day, 77,877 shares of Echelon exchanged hands as compared to its average daily volume of 94,200 shares. The stock ranged in price between $0.55-$0.62 after having opened the day at $0.58 as compared to the previous trading day's close of $0.58.

Echelon Corporation develops and markets energy control networking platforms. Its products enable everyday devices, including air conditioners, appliances, electricity meters, light switches, thermostats, and valves to be inter-connected. Echelon has a market cap of $24.3 million and is part of the technology sector. Shares are down 65.9% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates

Echelon

as a

sell

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

Highlights from TheStreet Ratings analysis on ELON 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 Electronic Equipment, Instruments & Components industry and the overall market, ECHELON CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 74.26%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 50.00% 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.
  • ECHELON CORP's earnings per share declined by 50.0% in the most recent quarter compared to the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. However, the consensus estimate suggests that this trend should reverse in the coming year. During the past fiscal year, ECHELON CORP reported poor results of -$0.37 versus -$0.35 in the prior year. This year, the market expects an improvement in earnings (-$0.22 versus -$0.37).
  • The gross profit margin for ECHELON CORP is rather high; currently it is at 64.26%. Regardless of ELON's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, ELON's net profit margin of -55.14% significantly underperformed when compared to the industry average.
  • Net operating cash flow has increased to -$1.87 million or 42.84% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 7.00%.

You can view the full analysis from the report here:

Echelon Ratings Report

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Interphase

(

INPH

) was another company that pushed the Computer Hardware industry lower today. Interphase was down $0.03 (8.2%) to $0.30 on light volume. Throughout the day, 14,731 shares of Interphase exchanged hands as compared to its average daily volume of 126,000 shares. The stock ranged in price between $0.30-$0.34 after having opened the day at $0.31 as compared to the previous trading day's close of $0.33.

Interphase Corporation, an information and communications technology company, provides embedded computing solutions, engineering design services, and contract manufacturing services in North America, the Pacific Rim, and Europe. Interphase has a market cap of $2.9 million and is part of the technology sector. Shares are down 85.5% year-to-date as of the close of trading on Wednesday.

TheStreet Ratings rates

Interphase

as a

sell

. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, weak operating cash flow and poor profit margins.

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Highlights from TheStreet Ratings analysis on INPH go as follows:

  • INTERPHASE CORP's earnings per share declined by 28.6% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern earnings per share over the past two years. During the past fiscal year, INTERPHASE CORP reported poor results of -$0.68 versus -$0.39 in the prior year.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Communications Equipment industry. The net income has significantly decreased by 48.5% when compared to the same quarter one year ago, falling from -$1.02 million to -$1.51 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 Communications Equipment industry and the overall market, INTERPHASE CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$1.30 million or 68.66% 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 INTERPHASE CORP is currently lower than what is desirable, coming in at 34.58%. Regardless of INPH's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, INPH's net profit margin of -72.58% significantly underperformed when compared to the industry average.

You can view the full analysis from the report here:

Interphase Ratings Report

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