3 Stocks Improving Performance Of The Technology Sector

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All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 69 points (0.4%) at 16,675 as of Tuesday, May 27, 2014, 3:55 PM ET. The NYSE advances/declines ratio sits at 1,940 issues advancing vs. 1,055 declining with 160 unchanged.

The Technology sector as a whole closed the day up 2.3% versus the S&P 500, which was up 0.6%. Top gainers within the Technology sector included TSR ( TSRI), up 9.3%, Peerless Systems ( PRLS), up 4.1%, Qualstar ( QBAK), up 4.9%, Net Element ( NETE), up 7.7% and LGL Group ( LGL), up 3.9%.

TheStreet Ratings Group would like to highlight 3 stocks pushing the sector higher today:

LGL Group ( LGL) is one of the companies that pushed the Technology sector higher today. LGL Group was up $0.16 (3.9%) to $4.18 on average volume. Throughout the day, 6,392 shares of LGL Group exchanged hands as compared to its average daily volume of 5,300 shares. The stock ranged in a price between $4.10-$4.34 after having opened the day at $4.34 as compared to the previous trading day's close of $4.02.

The LGL Group, Inc., through its subsidiaries, designs, manufactures, and markets standard and custom-engineered electronic components in the United States and internationally. LGL Group has a market cap of $10.4 million and is part of the computer software & services industry. Shares are down 25.7% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate LGL Group a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates LGL Group as a sell. The company's weaknesses can be seen in multiple areas, such as its feeble growth in its earnings per share, deteriorating net income, disappointing return on equity, poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on LGL go as follows:

  • LGL GROUP INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. The company has reported a trend of declining earnings per share over the past two years. During the past fiscal year, LGL GROUP INC reported poor results of -$3.16 versus -$0.51 in the prior year.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Electronic Equipment, Instruments & Components industry. The net income has significantly decreased by 874.7% when compared to the same quarter one year ago, falling from -$0.08 million to -$0.81 million.
  • Return on equity has greatly decreased when compared to its ROE from the same quarter one year prior. This is a signal of major weakness within the corporation. Compared to other companies in the Electronic Equipment, Instruments & Components industry and the overall market, LGL GROUP INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for LGL GROUP INC is currently lower than what is desirable, coming in at 29.86%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -13.19% is significantly below that of the industry average.
  • The share price of LGL GROUP INC has not done very well: it is down 24.73% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. 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.

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

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