Under-the-Radar Tech Stocks for Today

"Under-the-Radar Stocks" is a daily feature that uncovers little-known companies worthy of investors' consideration. Check in at 5 every morning to find out about stocks that tend to beat their bigger brethren.

Technology stocks took the spotlight Monday as Cisco ( CSCO) was selected to replace General Motors ( GM) in the Dow Jones Industrial Average.

Apple ( AAPL), Research in Motion ( RIMM), Amazon ( AMZN) and Google ( GOOG), known as the "four horsemen of tech," have jumped more than 40% this year as the Nasdaq has risen 16%. Despite the tech rebound, undiscovered bargains remain. The following small-cap companies offer strong balance sheets, a discount and, the ultimate tech rarity, high dividend yields.

TheStreet.com Ratings

Minnetonka, Minnesota-based Communications Systems ( JCS) makes and sells modular connecting and wiring devices and media and rate conversion products in the U.S., U.K. and China. Although the company's first-quarter revenue declined 12%, earnings per share ballooned 650%. Communications Systems has an ideal financial structure. It holds just $3 million of debt and over $31 million in cash reserves. TheStreet.com Ratings upgraded Communications Systems to "buy" on May 12.

In line with the company's impressive operating performance, its stock has risen 37% this year. Nevertheless, the shares remain cheap compared with other communications equipment firms. They trade at a price-to-earnings ratio of 10.88, 58% cheaper than the peer average. The shares are also cheap on the basis of sales and book value. At its current price, the stock offers a dividend yield of 5.26%, higher than the S&P 500 Index's average of 3.42%. The company has a market value of just $82 million.

Huntsville, Alabama-based Adtran ( ADTN) develops products and services that provide access to communications networks. The company's first-quarter sales and earnings per share fell 8% to $111 million and $0.24, respectively. Although those results suggest weakness, Adtran is poised for growth due to its strong financial position. The company boasts a quick ratio of 3.97, indicating ample cash reserves, and has a low debt-to-equity ratio of 0.12. TheStreet.com Ratings lifted the stock to "buy" on April 30.

Similar to Communications Systems, Adtran is undervalued by the market. The shares are trading at a discount in the communications equipment industry on the basis of earnings, sales and cash flow. With a price-to-earnings ratio of 17.32, Adtran is 32% cheaper than its average peer. The stock has a dividend yield of 1.7%, beating the Nasdaq 100's average of 0.75%. Consider this stock for appreciation potential. The company has a market capitalization of $1.3 billion.

TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.

More from Technology

Elon Musk's Latest Twitter Tirade Is the Dumbest Thing on Wall Street

Elon Musk's Latest Twitter Tirade Is the Dumbest Thing on Wall Street

Flashback Friday: Amazon, Chip Stocks, Memorial Day

Flashback Friday: Amazon, Chip Stocks, Memorial Day

Some Companies Are Already Feeling the Effect of GDPR

Some Companies Are Already Feeling the Effect of GDPR

Experts Break Down GDPR Risks for Investors

Experts Break Down GDPR Risks for Investors

Netflix Ready to Surpass Disney as America's Most Valuable Media Company

Netflix Ready to Surpass Disney as America's Most Valuable Media Company