Brocade Communications Systems Inc (BRCD): Today's Featured Computer Hardware Laggard

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

Brocade Communications Systems ( BRCD) pushed the Computer Hardware industry lower today making it today's featured Computer Hardware laggard. The industry as a whole closed the day up 0.7%. By the end of trading, Brocade Communications Systems fell $0.11 (-1.9%) to $5.67 on average volume. Throughout the day, 7,004,709 shares of Brocade Communications Systems exchanged hands as compared to its average daily volume of 7,102,100 shares. The stock ranged in price between $5.62-$5.79 after having opened the day at $5.75 as compared to the previous trading day's close of $5.78. Other companies within the Computer Hardware industry that declined today were: Overland Storage ( OVRL), down 5.0%, Dataram Corporation ( DRAM), down 4.0%, Palo Alto Networks ( PANW), down 3.6% and Gigamon ( GIMO), down 3.1%.
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Brocade Communications Systems, Inc. engages in the supply of Internet protocol based Ethernet networking solutions and storage area networking (SAN) solutions to businesses and organizations worldwide. Brocade Communications Systems has a market cap of $2.7 billion and is part of the technology sector. The company has a P/E ratio of 23.0, above the S&P 500 P/E ratio of 17.7. Shares are up 12.4% year to date as of the close of trading on Monday. Currently there are 3 analysts that rate Brocade Communications Systems a buy, 2 analysts rate it a sell, and 13 rate it a hold.

TheStreet Ratings rates Brocade Communications Systems as a buy. The company's strengths can be seen in multiple areas, such as its impressive record of earnings per share growth, compelling growth in net income, largely solid financial position with reasonable debt levels by most measures, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

On the positive front, XRS ( XRSC), down 7.9%, Radisys Corporation ( RSYS), down 6.5%, Universal Display Corporation ( PANL), down 6.3% and China TechFaith Wireless Comm Tech ( CNTF), down 5.8% , were all gainers within the computer hardware industry with Seagate Technology ( STX) being today's featured computer hardware industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the computer hardware industry could consider iShares Dow Jones US Technology ( IYW) while those bearish on the computer hardware industry could consider ProShares Ultra Short Semiconductor ( SSG).

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