3 Stocks Pushing The Technology Sector 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 Technology sector as a whole closed the day down 0.8% versus the S&P 500, which was down 0.2%. Laggards within the Technology sector included Qualstar ( QBAK), down 8.1%, Cover-All Technologies ( COVR), down 2.8%, BluePhoenix Solutions ( BPHX), down 2.0%, Nortech Systems ( NSYS), down 2.2% and TigerLogic ( TIGR), down 1.5%.

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

BluePhoenix Solutions ( BPHX) is one of the companies that pushed the Technology sector lower today. BluePhoenix Solutions was down $0.08 (2.0%) to $3.92 on heavy volume. Throughout the day, 18,685 shares of BluePhoenix Solutions exchanged hands as compared to its average daily volume of 6,200 shares. The stock ranged in price between $3.90-$4.02 after having opened the day at $3.93 as compared to the previous trading day's close of $4.00.

BluePhoenix Solutions Ltd. develops and markets enterprise legacy lifecycle information technology (IT) modernization solutions worldwide. BluePhoenix Solutions has a market cap of $44.7 million and is part of the computer software & services industry. Shares are down 13.0% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates BluePhoenix Solutions as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on BPHX 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 Software industry. The net income has significantly decreased by 53.8% when compared to the same quarter one year ago, falling from -$0.60 million to -$0.92 million.
  • Net operating cash flow has decreased to -$1.68 million or 49.11% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The share price of BLUEPHOENIX SOLUTIONS LTD has not done very well: it is down 8.41% 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.
  • The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. Compared to other companies in the Software industry and the overall market, BLUEPHOENIX SOLUTIONS LTD's return on equity significantly trails that of both the industry average and the S&P 500.
  • 49.55% is the gross profit margin for BLUEPHOENIX SOLUTIONS LTD which we consider to be strong. Regardless of BPHX's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, BPHX's net profit margin of -49.33% significantly underperformed when compared to the industry average.

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

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At the close, Cover-All Technologies ( COVR) was down $0.03 (2.8%) to $1.20 on average volume. Throughout the day, 17,784 shares of Cover-All Technologies exchanged hands as compared to its average daily volume of 17,900 shares. The stock ranged in price between $1.20-$1.23 after having opened the day at $1.23 as compared to the previous trading day's close of $1.23.

Cover-All Technologies Inc., through its subsidiary, Cover-All Systems, Inc., licenses and maintains software products for the property/casualty insurance industry in the United States and Puerto Rico. Cover-All Technologies has a market cap of $32.5 million and is part of the computer software & services industry. Shares are down 12.9% year-to-date as of the close of trading on Monday.

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TheStreet Ratings rates Cover-All Technologies as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on COVR 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 Software industry. The net income has significantly decreased by 38.4% when compared to the same quarter one year ago, falling from $0.71 million to $0.43 million.
  • Current return on equity is lower than its ROE from the same quarter one year prior. This is a clear sign of weakness within the company. Compared to other companies in the Software industry and the overall market, COVER-ALL TECHNOLOGIES INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The share price of COVER-ALL TECHNOLOGIES INC has not done very well: it is down 8.09% 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.
  • COVER-ALL TECHNOLOGIES INC's earnings per share declined by 33.3% in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, COVER-ALL TECHNOLOGIES INC continued to lose money by earning -$0.10 versus -$0.20 in the prior year.
  • The revenue fell significantly faster than the industry average of 12.0%. Since the same quarter one year prior, revenues fell by 24.4%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.

You can view the full analysis from the report here: Cover-All Technologies Ratings Report

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Qualstar ( QBAK) was another company that pushed the Technology sector lower today. Qualstar was down $0.10 (8.1%) to $1.13 on average volume. Throughout the day, 13,652 shares of Qualstar exchanged hands as compared to its average daily volume of 11,200 shares. The stock ranged in price between $1.13-$1.25 after having opened the day at $1.16 as compared to the previous trading day's close of $1.23.

Qualstar Corporation designs, develops, manufactures, and sells power supplies and data storage systems worldwide. The company operates in two segments, Power Supplies and Tape Libraries. Qualstar has a market cap of $14.5 million and is part of the computer software & services industry. Shares are up 8.8% year-to-date as of the close of trading on Monday.

TheStreet Ratings rates Qualstar as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow and generally disappointing historical performance in the stock itself.

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Highlights from TheStreet Ratings analysis on QBAK go as follows:

  • 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, QUALSTAR CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has significantly decreased to -$2.61 million or 191.49% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • QBAK has underperformed the S&P 500 Index, declining 15.39% 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.
  • QUALSTAR CORP has improved earnings per share by 33.3% in the most recent quarter compared to the same quarter a year ago. This company has not demonstrated a clear trend in earnings over the past 2 years, making it difficult to accurately predict earnings for the coming year. During the past fiscal year, QUALSTAR CORP reported poor results of -$0.85 versus -$0.35 in the prior year.
  • The revenue fell significantly faster than the industry average of 9.0%. Since the same quarter one year prior, revenues fell by 24.8%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

You can view the full analysis from the report here: Qualstar 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.

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