One Factor Driving Anadigics (ANAD) Stock to a One-Year Low Today

NEW YORK (TheStreet) -- Anadigics  (ANAD) fell to a one-year low of $1.39 on Monday as the technology sector continued to decline.

The tech sector was off slightly more than 1% just before 12:30 p.m., and the Dow Jones Industrial Average was down 0.83%.

Anadigics was down 10.44% to $1.41 at 12:24 p.m. More than 1.2 million shares had changed hands, more than double the average volume of 571,681.

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TheStreet Ratings team rates ANADIGICS INC as a "sell" with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:

"We rate ANADIGICS INC (ANAD) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Semiconductors & Semiconductor Equipment industry and the overall market, ANADIGICS INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for ANADIGICS INC is rather low; currently it is at 22.30%. Despite the low profit margin, it has increased significantly from the same period last year. Despite the mixed results of the gross profit margin, ANAD's net profit margin of -27.44% significantly underperformed when compared to the industry average.
  • ANAD has underperformed the S&P 500 Index, declining 16.42% from its price level of one year ago. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
  • ANADIGICS INC has improved earnings per share by 47.8% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, ANADIGICS INC continued to lose money by earning -$0.68 versus -$1.00 in the prior year. This year, the market expects an improvement in earnings (-$0.29 versus -$0.68).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income increased by 38.0% when compared to the same quarter one year prior, rising from -$16.06 million to -$9.96 million.
  • You can view the full analysis from the report here: ANAD Ratings Report

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Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

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