SolarWinds Inc. (SWI): Computer Software & Services' Starring Winner Of The Day

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.

SolarWinds ( SWI) pushed the Computer Software & Services industry higher today making it today's featured computer software & services winner. The industry as a whole closed the day down 1.6%. By the end of trading, SolarWinds rose 78 cents (1.4%) to $58.58 on average volume. Throughout the day, 569,467 shares of SolarWinds exchanged hands as compared to its average daily volume of 589,500 shares. The stock ranged in a price between $57.87-$59.51 after having opened the day at $59.25 as compared to the previous trading day's close of $57.80. Other companies within the Computer Software & Services industry that increased today were: Innovative Solutions and Support ( ISSC), up 11%, Vringo ( VRNG), up 7.5%, Edgewater Technology ( EDGW), up 4.7%, and Ninetowns Technology Group Company ( NINE), up 4.4%.
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SolarWinds, Inc. designs, develops, markets, sells, and supports enterprise-class information technology (IT) and infrastructure management software to IT professionals in various organizations worldwide. SolarWinds has a market cap of $4.38 billion and is part of the technology sector. The company has a P/E ratio of 54.5, above the S&P 500 P/E ratio of 17.7. Shares are up 10.2% year to date as of the close of trading on Tuesday. Currently there are seven analysts that rate SolarWinds a buy, one analyst rates it a sell, and six rate it a hold.

TheStreet Ratings rates SolarWinds as a buy. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and good cash flow from operations. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.

On the negative front, BOS Better Online Solutions ( BOSC), down 12.9%, Helios and Matheson Information Technology ( HMNY), down 10.3%, China Information Technology ( CNIT), down 9.5%, and Avid Technology ( AVID), down 8.8%, were all laggards within the computer software & services industry with Cognizant Technology Solutions Corporation ( CTSH) being today's computer software & services industry laggard.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the computer software & services industry could consider iShares S&P NA Tech Software Idx ( IGV) while those bearish on the computer software & services industry could consider ProShares Ultra Short Technology ( REW).

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