3 Stocks Boosting The Computer Hardware Industry Higher

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.

Two out of the three major indices traded up today One out of the three major indices traded up today The three major indices are trading lower today with the Dow Jones Industrial Average ( ^DJI) trading down 30.21 points (-0.2%) at 16,882 as of Wednesday, July 30, 2014, 3:55 PM ET. The NYSE advances/declines ratio sits at 1,028 issues advancing vs. 1,986 declining with 144 unchanged.

The Computer Hardware industry as a whole closed the day up 0.9% versus the S&P 500, which was up 0.1%. Top gainers within the Computer Hardware industry included Video Display ( VIDE), up 1.9%, Lantronix ( LTRX), up 6.2%, Dataram ( DRAM), up 21.8%, Hutchinson Technology ( HTCH), up 2.4% and Silicon Graphics International ( SGI), up 8.8%.

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

Silicon Graphics International ( SGI) is one of the companies that pushed the Computer Hardware industry higher today. Silicon Graphics International was up $0.79 (8.8%) to $9.80 on average volume. Throughout the day, 249,248 shares of Silicon Graphics International exchanged hands as compared to its average daily volume of 274,200 shares. The stock ranged in a price between $9.13-$9.81 after having opened the day at $9.13 as compared to the previous trading day's close of $9.01.

Silicon Graphics International has a market cap of $301.3 million and is part of the technology sector. Shares are down 32.8% year-to-date as of the close of trading on Tuesday.

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Highlights from TheStreet Ratings analysis on SGI go as follows:

You can view the full analysis from the report here: Silicon Graphics International Ratings Report

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

At the close, Hutchinson Technology ( HTCH) was up $0.05 (2.4%) to $2.12 on light volume. Throughout the day, 30,706 shares of Hutchinson Technology exchanged hands as compared to its average daily volume of 228,500 shares. The stock ranged in a price between $2.09-$2.18 after having opened the day at $2.14 as compared to the previous trading day's close of $2.07.

Hutchinson Technology Incorporated researches, designs, develops, manufactures, and supplies suspension assemblies for hard disk drives. The company's suspension assemblies are components in computers, and various consumer electronics and enterprise storage products. Hutchinson Technology has a market cap of $58.2 million and is part of the technology sector. Shares are down 35.3% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates Hutchinson Technology a buy, no analysts rate it a sell, and 1 rates it a hold.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreet Ratings rates Hutchinson Technology as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally high debt management risk, disappointing return on equity, poor profit margins and weak operating cash flow.

Highlights from TheStreet Ratings analysis on HTCH go as follows:

  • 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 Computers & Peripherals industry. The net income has significantly decreased by 566.3% when compared to the same quarter one year ago, falling from $1.87 million to -$8.71 million.
  • The debt-to-equity ratio of 1.22 is relatively high when compared with the industry average, suggesting a need for better debt level management. Along with the unfavorable debt-to-equity ratio, HTCH maintains a poor quick ratio of 0.80, which illustrates the inability to avoid short-term cash problems.
  • 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 Computers & Peripherals industry and the overall market, HUTCHINSON TECHNOLOGY INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for HUTCHINSON TECHNOLOGY INC is currently lower than what is desirable, coming in at 25.96%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -14.34% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$2.19 million or 158.83% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

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

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

Lantronix ( LTRX) was another company that pushed the Computer Hardware industry higher today. Lantronix was up $0.12 (6.2%) to $2.05 on light volume. Throughout the day, 12,865 shares of Lantronix exchanged hands as compared to its average daily volume of 24,000 shares. The stock ranged in a price between $1.91-$2.05 after having opened the day at $1.91 as compared to the previous trading day's close of $1.93.

Lantronix, Inc. designs, develops, markets, and sells networking and communications products with a focus on the convergence of mobility with machine-to-machine systems. The company provides solutions that enable machines, devices, and sensors to be securely accessed, managed, and controlled. Lantronix has a market cap of $29.5 million and is part of the technology sector. Shares are up 23.3% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates Lantronix a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Lantronix as a sell. Among the areas we feel are negative, one of the most important has been an overall disappointing return on equity.

Highlights from TheStreet Ratings analysis on LTRX go 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 Communications Equipment industry and the overall market, LANTRONIX INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • LTRX, with its decline in revenue, slightly underperformed the industry average of 0.4%. Since the same quarter one year prior, revenues slightly dropped by 4.7%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • The gross profit margin for LANTRONIX INC is rather high; currently it is at 51.94%. 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 -1.12% is in-line with the industry average.
  • Net operating cash flow has significantly increased by 84.49% to -$0.12 million when compared to the same quarter last year. In addition, LANTRONIX INC has also vastly surpassed the industry average cash flow growth rate of 17.47%.
  • LTRX's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.07, which illustrates the ability to avoid short-term cash problems.

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

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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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