3 Technology Stocks Moving The Sector Upward

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.

All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 68 points (0.4%) at 17,137 as of Friday, Sept. 5, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,903 issues advancing vs. 1,131 declining with 161 unchanged.

The Technology sector as a whole closed the day up 0.4% versus the S&P 500, which was up 0.5%. Top gainers within the Technology sector included Sajan ( SAJA), up 8.9%, One Horizon Group ( OHGI), up 2.5%, Qualstar ( QBAK), up 3.1%, Electro-Sensors ( ELSE), up 3.4% and Advanced Photonix ( API), up 4.0%.

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

Advanced Photonix ( API) is one of the companies that pushed the Technology sector higher today. Advanced Photonix was up $0.02 (4.0%) to $0.52 on light volume. Throughout the day, 8,341 shares of Advanced Photonix exchanged hands as compared to its average daily volume of 51,700 shares. The stock ranged in a price between $0.50-$0.52 after having opened the day at $0.51 as compared to the previous trading day's close of $0.50.

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 $18.7 million and is part of the telecommunications industry. Shares are down 27.5% year-to-date as of the close of trading on Thursday. Currently there is 1 analyst who rates Advanced Photonix a buy, no analysts rate it a sell, and none rate it a hold.

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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

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At the close, Qualstar ( QBAK) was up $0.04 (3.1%) to $1.24 on light volume. Throughout the day, 290 shares of Qualstar exchanged hands as compared to its average daily volume of 9,700 shares. The stock ranged in a price between $1.24-$1.24 after having opened the day at $1.24 as compared to the previous trading day's close of $1.20.

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 $14.7 million and is part of the telecommunications industry. Shares are up 6.4% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Qualstar a buy, no analysts rate it a sell, and none rate it a hold.

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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.

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 17.69% 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 9.3%. 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

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Sajan ( SAJA) was another company that pushed the Technology sector higher today. Sajan was up $0.45 (8.9%) to $5.50 on average volume. Throughout the day, 751 shares of Sajan exchanged hands as compared to its average daily volume of 600 shares. The stock ranged in a price between $5.20-$5.50 after having opened the day at $5.20 as compared to the previous trading day's close of $5.05.

Sajan has a market cap of $20.9 million and is part of the telecommunications industry. Shares are down 12.9% year-to-date as of the close of trading on Thursday.

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.