3 Stocks Improving Performance Of The Electronics Industry

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 are trading lower today with the Dow Jones Industrial Average ( ^DJI) trading down 30.89 points (-0.2%) at 17,068 as of Tuesday, Sept. 2, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,485 issues advancing vs. 1,589 declining with 141 unchanged.

The Electronics industry as a whole closed the day up 0.6% versus the S&P 500, which was down 0.1%. Top gainers within the Electronics industry included Advanced Photonix ( API), up 6.1%, Bel Fuse ( BELFA), up 3.1%, Sevcon ( SEV), up 2.5%, Advantest ( ATE), up 2.3% and Viasystems Group ( VIAS), up 1.7%.

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

Advantest ( ATE) is one of the companies that pushed the Electronics industry higher today. Advantest was up $0.27 (2.3%) to $11.90 on heavy volume. Throughout the day, 28,729 shares of Advantest exchanged hands as compared to its average daily volume of 7,700 shares. The stock ranged in a price between $11.70-$11.97 after having opened the day at $11.97 as compared to the previous trading day's close of $11.63.

Advantest Corporation manufactures and sells semiconductor and component test system products and mechatronics-related products. It operates through three segments: Semiconductor and Component Test System; Mechatronics System; and Services, Support and Others. Advantest has a market cap of $2.0 billion and is part of the technology sector. Shares are down 5.1% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate Advantest a buy, no analysts rate it a sell, and none rate it a hold.

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

Highlights from TheStreet Ratings analysis on ATE 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 Semiconductors & Semiconductor Equipment industry and the overall market, ADVANTEST CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • In its most recent trading session, ATE has closed at a price level that was not very different from its closing price of one year earlier. This is probably due to its weak earnings growth as well as other mixed factors. 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.
  • ADVANTEST CORP reported significant earnings per share improvement 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, ADVANTEST CORP reported poor results of -$1.97 versus -$0.24 in the prior year.
  • Despite currently having a low debt-to-equity ratio of 0.48, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that ATE's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.30 is high and demonstrates strong liquidity.
  • The gross profit margin for ADVANTEST CORP is rather high; currently it is at 58.73%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, ATE's net profit margin of 3.63% significantly trails the industry average.

You can view the full analysis from the report here: Advantest 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, Bel Fuse ( BELFA) was up $0.70 (3.1%) to $23.30 on heavy volume. Throughout the day, 5,015 shares of Bel Fuse exchanged hands as compared to its average daily volume of 1,400 shares. The stock ranged in a price between $22.72-$23.85 after having opened the day at $22.89 as compared to the previous trading day's close of $22.60.

Bel Fuse Inc. designs, manufactures, and sells products used in the networking, telecommunication, high-speed data transmission, commercial aerospace, military, broadcasting, transportation, and consumer electronic industries worldwide. Bel Fuse has a market cap of $49.2 million and is part of the technology sector. Shares are up 16.3% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate Bel Fuse a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Bel Fuse as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, impressive record of earnings per share growth, compelling growth in net income and reasonable valuation levels. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from TheStreet Ratings analysis on BELFA go as follows:

  • BELFA's revenue growth has slightly outpaced the industry average of 3.4%. Since the same quarter one year prior, revenues slightly increased by 5.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Powered by its strong earnings growth of 80.00% and other important driving factors, this stock has surged by 28.33% over the past year, outperforming the rise in the S&P 500 Index during the same period. Turning to the future, naturally, any stock can fall in a major bear market. However, in almost any other environment, the stock should continue to move higher despite the fact that it has already enjoyed nice gains in the past year.
  • BEL FUSE INC reported significant earnings per share improvement 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. During the past fiscal year, BEL FUSE INC increased its bottom line by earning $1.39 versus $0.19 in the prior year. This year, the market expects an improvement in earnings ($1.65 versus $1.39).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Communications Equipment industry. The net income increased by 81.5% when compared to the same quarter one year prior, rising from $1.69 million to $3.07 million.

You can view the full analysis from the report here: Bel Fuse 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.

Advanced Photonix ( API) was another company that pushed the Electronics industry higher today. Advanced Photonix was up $0.03 (6.1%) to $0.52 on average volume. Throughout the day, 75,452 shares of Advanced Photonix exchanged hands as compared to its average daily volume of 50,900 shares. The stock ranged in a price between $0.48-$0.53 after having opened the day at $0.48 as compared to the previous trading day's close of $0.49.

Advanced Photonix, Inc. develops, manufactures, and sells optoelectronic devices, and value-added sub-systems and systems to various original equipment manufacturers primarily in North America, Asia, Europe, and Australia. Advanced Photonix has a market cap of $18.3 million and is part of the technology sector. Shares are down 29.0% year-to-date as of the close of trading on Friday. Currently there is 1 analyst who rates Advanced Photonix a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Advanced Photonix as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, poor profit margins, generally disappointing historical performance in the stock itself, unimpressive growth in net income and generally high debt management risk.

Highlights from TheStreet Ratings analysis on API 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 Electronic Equipment, Instruments & Components industry and the overall market, ADVANCED PHOTONIX INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for ADVANCED PHOTONIX INC is currently lower than what is desirable, coming in at 31.47%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -16.38% is significantly below that of the industry average.
  • Despite currently having a low debt-to-equity ratio of 0.45, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that API's debt-to-equity ratio is mixed in its results, the company's quick ratio of 0.60 is low and demonstrates weak liquidity.
  • The share price of ADVANCED PHOTONIX INC has not done very well: it is down 16.56% 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 change in net income from the same quarter one year ago has exceeded that of the Electronic Equipment, Instruments & Components industry average, but is less than that of the S&P 500. The net income has decreased by 5.6% when compared to the same quarter one year ago, dropping from -$1.08 million to -$1.14 million.

You can view the full analysis from the report here: Advanced Photonix 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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