10 Top Performing Technology Stocks

NEW YORK ( TheStreet) -- Rovi Corporation ( ROVI), Photronics ( PLAB), The Hackett Group ( HCKT) and Quantum ( QTM) are among a few technology stocks that outperformed the Nasdaq index during the past one month.

These stocks may continue to outstrip the index on strong fundamentals, company outlooks, and analysts' potential upsides. During the last one month, they have gained between 8% to 31%, compared to a 4.5% drop registered by the Nasdaq.

Below are the stocks ordered in terms of one-month return, lowest to highest.

10. Ness Technologies ( NSTC) is a global provider of information technology (IT), and business services and solutions with expertise in software product engineering, system integration, application development and consulting, and software distribution. The stock has gained 7.8% during the past month.

Net revenue for the first quarter of 2011 was reported at $137.3 million vs. $133.3 million in the year-ago quarter, primarily driven by its Gilon acquisition of $5.1 million, $2.9 in foreign currency transactions and $2.4 million in revenue from its software product engineering segment.

However, lower revenue of $2.2 million from the system integration and application development segment offset these increases. As of March 31, 2011, the backlog from continuing operations was $690 million, up 4% year over year.

On a non-GAAP basis, net income from continuing operations was $5.6 million, or 14 cents per share, up 66% year over year. Cash, cash equivalents and short-term bank deposits amounted to $35.8 million as cash flow from operations was $9.7 million, setting a new first-quarter record. Lastly, the company's current ratio remained constant at 1.24.

Calcalist recently reported that Citi Venture Capital International, a private equity fund backed by Citigroup Inc., is negotiating to purchase the company, without disclosing the source of information.

All five analysts covering the stock recommend buying it. There are no sell ratings on the stock. On average, analysts estimate a 17.1% upside to $7.63 in value from current levels.

9. KIT Digital ( KITD), through its operating subsidiaries, provides enterprise clients an end-to-end technology platform for managing Internet Protocol (IP)-based video assets across the browser, mobile device and Internet protocol television (IPTV) set-top box-enabled televisions. The stock has gained 9.1% during the last one month.

During the first quarter of 2011, revenue increased 5% sequentially to $34.5 million from the adjusted level of $32.8 million in the previous quarter. First-quarter revenue increased 98% compared to the year-ago level. Management estimates organic growth year over year at approximately 38%. Operating EBITDA, a non-GAAP metric, increased 5% to $7.1 million, or 19 cents per share, from $6.7 million, or 25 cents per share, in the earlier quarter, and increased 139% from $3 million, or 21 cents per share, from the year-ago quarter.

The company added 28 net new client contracts during the quarter, with an estimated average monthly revenue per client in excess of $30,000, reflecting its ongoing focus on higher-end opportunities in the market and large, multi-year contracts in emerging sectors and geographies. The company's client base totaled more than 2,200 customers on March 31, 2011.

During the second quarter, KIT digital achieved an important milestone in its multi-year mergers and acquisitions-led industry consolidation effort by reaching its targeted 45%-to-50% market share in the IP video platform software sector. On May 3, the company closed the ioko acquisition and expects to close the Polymedia acquisition within the next two weeks, after receiving necessary regulatory and other approvals.

Of the seven analysts covering the stock, 86% recommend a buy, while the remaining recommend a hold. There are no sell ratings on the stock. On average, analysts estimate 71.9% upside to $20.17 in value from current levels.

8. SciQuest ( SQI) is an on-demand strategic procurement and supplier enablement solution that integrates its customers with their suppliers. The company's on-demand software enables organizations to realize benefits of strategic procurement by identifying and establishing contracts with preferred suppliers, driving spend to those contracts and promoting process efficiencies through electronic transactions. The stock has gained 9.2% during the last one month.

For the first quarter of 2011, net income came in at $424,000, or 2 cents per share, on sales of $12.5 million, compared to $1.9 million, or 9 cents per share, on sales of $10.1 million in the year-ago quarter. Cash and cash equivalents stood at $9.5 million compared to $17.5 million in the prior quarter. However, cash flow from operations surged to $1.8 million from $368,000 in the first quarter of 2010. Moreover, the company remains debt free.

The company ended the first quarter with 313 customers, including 108 customers added after the AECsoft acquisition, an increase from 163 customers at the end of the first quarter of 2010. Furthermore, the company completed a follow-on stock offering on April 5, and executed the underwriters' overallotment option on April 13, raising $15 million in capital at the end of the first quarter.

Going forward, the company expects second quarter revenue to range from $12.8 million to $13.0 million, and GAAP net income per share in the range of 2 cents to 3 cents. Full-year revenue is forecast at $53.5 million to $54.5 million, while GAAP net income is expected between 13 cents per share and 14 cents per share.

All the four analysts covering the stock recommend a buy. There are no sell ratings on the stock. On average, analysts estimate 21.6% upside to $19 in value from current levels.

7. Quantum ( QTM) is a global storage company specializing in backup, recovery and archive solutions. From small businesses to multinational enterprises, more than 50,000 customers use Quantum's solutions to solve their data protection, retention and management challenges. The stock has gained 10% during the past month.

For the fourth quarter of 2011, net revenue was reported at $165.1 million vs. $164.5 million for the same quarter in 2010. Net loss narrowed to $1.7 million, or 1 cent per share, from $4.4 million, or 2 cents per share, in the year-ago quarter. Quantum ended the quarter with $78 million in total cash and cash equivalents and $239 million in total debt.

For the full year, the company generated $52 million in cash from operations, reduced total debt by $91 million, and refinanced its subordinated term debt with subordinated convertible debt at a significantly lower interest rate, which saved nearly $4 million in interest expense for fiscal year 2011 and approximately $10 million, going forward.

Full year 2011 revenue declined marginally to $672.3 million from $681.4 million in the previous year. Net income stood at $4.5 million, or 2 cents per share, from $16.6 million, or 2 cents per share, during 2010.

Going forward, revenues are forecast at $160 million for the first quarter of 2012. For full year 2012, the company expects higher revenues, driven by growth in the company's branded business, including branded disk systems and software sales.

Of the seven analysts covering the stock, 57% recommend a buy, while the remaining rate a hold. There are no sell ratings on the stock. On average, analysts estimate 20.7% upside to $3.85 in value from current levels.

6. Rovi Corp. ( ROVI) is focused on powering the discovery and enjoyment of digital entertainment by providing a set of integrated solutions that are embedded in its customers' products and services and used by end consumers to simplify and guide their interaction with digital entertainment. Its offerings include interactive program guides (IPGs), IPG advertising, embedded licensing technologies, and content protection technologies and services, among others. The stock has gained 11.6% in the past month.

During the first quarter 2011, total revenue stood at $161.5 million, up 24.8% from $129.4 million in the year-ago quarter due to higher IPG product revenue, addition of DivX products acquired in the Sonic acquisition and higher legacy Rovi product revenues. Net income increased 10% to $2.2 billion, or 28 cents per share, from $2 billion, or 25 cents per share, in the first quarter of 2010. Lastly, adjusted pro forma income was $71.7 million, or 61 cents per share, compared to $50.3 million, or 45 cents per share, during the first quarter of 2010. Analysts estimated earnings at 51 cents per share.

For full year 2011, the company expects adjusted pro forma revenue to range between $775 million and $825 million. Moreover, the company now expects adjusted EPS in the range of $2.25 to $2.55 versus the previous range of $2.20 to $2.50.

Of the 14 analysts covering the stock, 64% recommend a buy, while 29% rate a hold. On average, analysts estimate 28.8% upside to $69.86 in value from current levels.

5. Photronics ( PLAB) is a manufacturer of photomasks, which are precision photographic quartz plates containing microscopic images of electronic circuits. Photomasks are elements used in the manufacture of semiconductors and flat panel displays (FPDs). The stock has gained 15.6% during the past one month.

Net revenue for the second quarter soared 26.7% year over year to $133.1 million, exceeding the guidance of $117 million to $121 million. The company also achieved quarterly sales records for both IC and FPD photomasks.

Also, advanced IC sales grew 50% sequentially to $28.3 million. Lastly, non-GAAP net income was $14.8 million, or 24 cents per share, representing a 215% increase from $4.7 million, or 9 cents per share, in the comparable quarter of 2010. As of May 1, 2011, cash and cash equivalents stood at $186.1 million, up 88.1% from $98.9 million reported at the end of October, 2010. Moreover, the current ratio increased to 2.28 from 1.73

Going forward, the company expects third quarter 2011 revenue to range from $128 million to $133 million, with non-GAAP earnings per share in the range of 17 cents to 21 cents.

Of the six analysts covering the stock, 67% recommend a buy, while 17% recommend a hold. On average, analysts estimate 22.1% upside to $11.40 in value from current levels.

4. Opnext ( OPXT) is a designer and manufacturer of optical components, modules, and subsystems for communications use. The company's products enable high-speed network connectivity to address increasing data usage by the global population, to other businesses. The stock has gained 19.4% in the last one month.

Revenue for 2011 fourth quarter came in at $95.3 million, increasing 24% from $76.8 million in the year-ago quarter. Revenue from 10Gbps and below products increased $100,000, or less than 1%, while revenue for 40Gbps and above products rose 74% to $16.3 million. As a result, the company swung to a net income of $9 million, or 10 cents per share, compared to a loss of $18.3 million, or 20 cents per share in the year-ago quarter.

Full year 2011 revenue increased 12.1% to $357.6 million from $319.1 million in the previous year. Net loss was cut by more than a half to $31.8 million, or 35 cents per share, from $78.5 million, or 88 cents per share, during 2010.

Going forward, the company expects revenue to range between $93 million and $97 million in the first fiscal quarter ending June 2011.

Of the four analysts covering the stock, 75% recommend a buy. On average, analysts estimate 65.3% upside to $4.07 in value from current levels.

3. Magma Design Automation ( LAVA) provides electronic design automation (EDA) software products and related services. Its software enables chip designers to reduce design time and produce integrated circuits for the communications, computing, consumer electronics, networking, and semiconductor industries. The stock has gained 26.7% in the past month.

Revenue for 2011 fourth quarter came in at $38 million, increasing 13.2% from $33.6 million in the fourth quarter a year ago. In addition, the company swung to a net income of $1.7 million, or 2 cents per share, compared to a loss of $0.7 million, or 1 cent per share, in the year-ago quarter

Full year 2011 revenue increased 13.2% to $139.3 million from $123.1 million in the previous year. Net loss narrowed marginally to $3.2 million, or 5 cents per share, from $3.3 million, or 7 cents per share, during 2010.

Of the four analysts covering the stock, 75% recommend a buy and the remaining rate a hold. There are no sell ratings on the stock. On average, analysts estimate 18.6% upside to $9 in value from current levels.

2. Medquist Holdings ( MEDH), a provider of integrated clinical documentation solutions for the U.S. healthcare system, offers solutions that convert physicians' dictation of patient interactions, or the physician narrative, into a customized electronic record. The stock has gained 28.9% in the last one month.

For the first quarter of 2011, net revenue increased 31% to $111.2 million from the first quarter of 2010. Adjusted EBITDA was up 94% to $26.8 million from the prior-year quarter. Adjusted net income for the quarter increased to $16.4 million, or 31 cents per diluted share, from $8.7 million, or 17 cents per diluted share, in the earlier year quarter. The company's total clinical documentation volume increased to 866 million lines from 624 million lines.

Looking ahead to 2011, the company estimates total clinical documentation volume to range from 3.5 to 3.7 billion lines. Meanwhile, adjusted EBITDA is pegged between $113 and $116 million, while adjusted net income per share could range from $1.23 to $1.33.

The company recently announced receiving a contract from St. Joseph's Hospital Health Center in Syracuse, New York, to provide clinical documentation outsourcing services that are projected to achieve significant cost savings and improve efficiency and quality.

All the three analysts covering the stock recommend a buy. There are no sell ratings on the stock. A Bloomberg consensus expects the stock to gain an average 16.6% to $15.33 in the upcoming 12 months.

1. The Hackett Group ( HCKT), a global advisory firm, provides advisory, benchmarking, and transformation consulting services, including shared services, off-shoring and outsourcing advice. The company structures its operations into Archstone Consulting group, REL group (working capital solutions) and Hackett Technology Solutions group. The stock has gained 30.6% in the last month.

Net revenue for the first quarter of 2011 increased 13% to $52.9 million from the year-ago period. Pro-forma diluted earnings per share stood at 7 cents as compared to 5 cents for the year ago period. At the end of the first quarter 2011, cash balance stood at $18 million, while Hackett repurchased 673,000 shares of common stock for $2.4 million.

Heading into the second quarter 2011, the company expects gross revenue to range from $55 million to $57 million for a 7% to 10% sequential increase in net revenues. Meanwhile, pro-forma diluted earnings per share are likely to range between 7 cents and 9 cents. Besides, pro-forma EBITDA on net revenues is expected at approximately 12% to 13%.

Of the four analysts covering the stock, 75% recommend a buy and the remaining rate a hold. There are no sell ratings on the stock. A Bloomberg consensus expects the stock to gain an average 21.2% to $6 in the upcoming 12 months.

>>To see these stocks in action, visit the 10 Top Performing Technology Stocks portfolio on Stockpickr.

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