3 Stocks Boosting The Telecommunications 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.

One out of the three major indices traded up today Two 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 19.71 points (-0.1%) at 17,049 as of Thursday, Sept. 11, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,733 issues advancing vs. 1,330 declining with 151 unchanged.

The Telecommunications industry as a whole closed the day up 0.1% versus the S&P 500, which was up 0.1%. Top gainers within the Telecommunications industry included Maxcom Telecomunicaciones SAB de CV ( MXT), up 2.1%, Optical Cable ( OCC), up 2.4%, Technical Communications ( TCCO), up 1.6%, China TechFaith Wireless Comm Tech ( CNTF), up 2.2% and Envivio ( ENVI), up 3.0%.

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

Envivio ( ENVI) is one of the companies that pushed the Telecommunications industry higher today. Envivio was up $0.06 (3.0%) to $2.06 on average volume. Throughout the day, 77,672 shares of Envivio exchanged hands as compared to its average daily volume of 58,800 shares. The stock ranged in a price between $2.00-$2.12 after having opened the day at $2.00 as compared to the previous trading day's close of $2.00.

Envivio, Inc. provides software-based IP video processing and distribution solutions that enable the delivery of high-quality video to consumers. Envivio has a market cap of $55.2 million and is part of the technology sector. Shares are down 41.2% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Envivio a buy, no analysts rate it a sell, and 1 rates it a hold.

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

Highlights from TheStreet Ratings analysis on ENVI 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 64.8% when compared to the same quarter one year ago, falling from -$2.48 million to -$4.09 million.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 31.79%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 66.66% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Software industry and the overall market, ENVIVIO INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for ENVIVIO INC is rather high; currently it is at 58.24%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, ENVI's net profit margin of -35.67% significantly underperformed when compared to the industry average.
  • ENVI, with its decline in revenue, underperformed when compared the industry average of 11.6%. Since the same quarter one year prior, revenues slightly dropped by 0.8%. 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: Envivio 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, China TechFaith Wireless Comm Tech ( CNTF) was up $0.03 (2.2%) to $1.42 on average volume. Throughout the day, 78,944 shares of China TechFaith Wireless Comm Tech exchanged hands as compared to its average daily volume of 69,400 shares. The stock ranged in a price between $1.38-$1.46 after having opened the day at $1.38 as compared to the previous trading day's close of $1.39.

China Techfaith Wireless Communication Technology Limited is engaged in the original design, development, and sale of mobile handsets in the People's Republic of China and internationally. China TechFaith Wireless Comm Tech has a market cap of $78.3 million and is part of the technology sector. Shares are down 11.4% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate China TechFaith Wireless Comm Tech a buy, no analysts rate it a sell, and none rate 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 China TechFaith Wireless Comm Tech as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity and poor profit margins.

Highlights from TheStreet Ratings analysis on CNTF 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 114.9% when compared to the same quarter one year ago, falling from -$0.97 million to -$2.09 million.
  • 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 Computers & Peripherals industry and the overall market, CHINA TECHFAITH WIRELESS-ADR's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for CHINA TECHFAITH WIRELESS-ADR is currently extremely low, coming in at 11.43%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -8.76% is significantly below that of the industry average.
  • In its most recent trading session, CNTF 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. Turning our attention to the future direction of the stock, we do not believe this stock offers ample reward opportunity to compensate for the risks, despite the fact that it rose over the past year.
  • CHINA TECHFAITH WIRELESS-ADR 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. Stable Earnings per share over the past year indicate the company has sound management over its earnings and share float. During the past fiscal year, CHINA TECHFAITH WIRELESS-ADR continued to lose money by earning -$0.05 versus -$0.06 in the prior year.

You can view the full analysis from the report here: China TechFaith Wireless Comm Tech 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.

Maxcom Telecomunicaciones SAB de CV ( MXT) was another company that pushed the Telecommunications industry higher today. Maxcom Telecomunicaciones SAB de CV was up $0.03 (2.1%) to $1.45 on light volume. Throughout the day, 223 shares of Maxcom Telecomunicaciones SAB de CV exchanged hands as compared to its average daily volume of 4,300 shares. The stock ranged in a price between $1.42-$1.45 after having opened the day at $1.42 as compared to the previous trading day's close of $1.42.

Maxcom Telecomunicaciones, S.A.B. de C.V., an integrated telecommunication services operator, provides voice and data services to residential and small and medium-sized business customers in Mexico. Maxcom Telecomunicaciones SAB de CV has a market cap of $213.5 million and is part of the technology sector. Shares are down 12.9% year-to-date as of the close of trading on Wednesday. Currently there are no analysts who rate Maxcom Telecomunicaciones SAB de CV a buy, no analysts rate it a sell, and 1 rates it a hold.

TheStreet Ratings rates Maxcom Telecomunicaciones SAB de CV 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 and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on MXT go as follows:

  • MAXCOM TELECOMUNICACIONES SA 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, MAXCOM TELECOMUNICACIONES SA reported poor results of -$0.57 versus -$0.11 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 Diversified Telecommunication Services industry. The net income has significantly decreased by 134.3% when compared to the same quarter one year ago, falling from $4.19 million to -$1.44 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 Diversified Telecommunication Services industry and the overall market, MAXCOM TELECOMUNICACIONES SA's return on equity significantly trails that of both the industry average and the S&P 500.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 43.55%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 133.33% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • 49.71% is the gross profit margin for MAXCOM TELECOMUNICACIONES SA which we consider to be strong. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, MXT's net profit margin of -2.88% significantly underperformed when compared to the industry average.

You can view the full analysis from the report here: Maxcom Telecomunicaciones SAB de CV 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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