3 Stocks Pushing The Telecommunications Industry Lower

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.

The Telecommunications industry as a whole closed the day down 0.6% versus the S&P 500, which was unchanged. Laggards within the Telecommunications industry included Technical Communications ( TCCO), down 17.8%, RELM Wireless ( RWC), down 3.0%, Glowpoint ( GLOW), down 2.3%, Iteris ( ITI), down 2.3% and Communications Systems ( JCS), down 1.8%.

TheStreet Ratings Group would like to highlight 3 stocks that pushed the industry lower today:

Iteris ( ITI) is one of the companies that pushed the Telecommunications industry lower today. Iteris was down $0.04 (2.3%) to $1.73 on light volume. Throughout the day, 31,813 shares of Iteris exchanged hands as compared to its average daily volume of 53,800 shares. The stock ranged in price between $1.73-$1.78 after having opened the day at $1.74 as compared to the previous trading day's close of $1.77.

Iteris, Inc. provides intelligent transportation systems solutions to the traffic management market worldwide. Iteris has a market cap of $54.7 million and is part of the technology sector. Shares are down 20.5% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates Iteris as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, growth in earnings per share, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from TheStreet Ratings analysis on ITI go as follows:

  • The revenue growth came in higher than the industry average of 6.1%. Since the same quarter one year prior, revenues rose by 18.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • ITI has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with this, the company maintains a quick ratio of 2.72, which clearly demonstrates the ability to cover short-term cash needs.
  • ITERIS INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. Stable earnings per share over the past year indicate the company has sound management over its earnings and share float. We anticipate these figures will begin to experience more growth in the coming year. During the past fiscal year, ITERIS INC's EPS of $0.03 remained unchanged from the prior years' EPS of $0.03. This year, the market expects an improvement in earnings ($0.06 versus $0.03).
  • 38.84% is the gross profit margin for ITERIS INC which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 1.43% trails the industry average.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, ITERIS INC's return on equity significantly trails that of both the industry average and the S&P 500.

You can view the full analysis from the report here: Iteris Ratings Report

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