3 Stocks Improving Performance Of The Computer Software & Services 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.

All three major indices are trading down today with the Dow Jones Industrial Average ( ^DJI) trading down 41.93 points (-0.2%) at 17,071 as of Monday, Sept. 29, 2014, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,274 issues advancing vs. 1,814 declining with 136 unchanged.

The Computer Software & Services industry as a whole closed the day up 0.2% versus the S&P 500, which was down 0.3%. Top gainers within the Computer Software & Services industry included Bridgeline Digital ( BLIN), up 2.8%, TigerLogic ( TIGR), up 1.6%, TSR ( TSRI), up 2.9%, Cover-All Technologies ( COVR), up 2.5% and CollabRx ( CLRX), up 1.9%.

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

CollabRx ( CLRX) is one of the companies that pushed the Computer Software & Services industry higher today. CollabRx was up $0.02 (1.9%) to $1.07 on light volume. Throughout the day, 2,365 shares of CollabRx exchanged hands as compared to its average daily volume of 31,700 shares. The stock ranged in a price between $1.05-$1.08 after having opened the day at $1.08 as compared to the previous trading day's close of $1.05.

CollabRx, Inc. provides cloud-based expert systems to inform healthcare decision-making. The company's cloud-based expert systems provide clinical knowledge to institutions, physicians, researchers, and patients for genomics-based medicine in cancer. CollabRx has a market cap of $3.1 million and is part of the technology sector. Shares are down 72.4% year-to-date as of the close of trading on Friday. Currently there is 1 analyst who rates CollabRx 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 CollabRx as a sell. The company's weaknesses can be seen in multiple areas, such as its unimpressive growth in net income, disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from TheStreet Ratings analysis on CLRX go as follows:

  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed against the S&P 500 and did not exceed that of the Health Care Technology industry. The net income has significantly decreased by 56.6% when compared to the same quarter one year ago, falling from -$0.80 million to -$1.25 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 Health Care Technology industry and the overall market, COLLABRX INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • Net operating cash flow has decreased to -$0.73 million or 19.96% when compared to the same quarter last year. In addition, when comparing the cash generation rate to the industry average, the firm's growth is significantly lower.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 75.59%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 74.28% 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.
  • COLLABRX INC 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. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, COLLABRX INC continued to lose money by earning -$1.78 versus -$2.15 in the prior year. For the next year, the market is expecting a contraction of 3.9% in earnings (-$1.85 versus -$1.78).

You can view the full analysis from the report here: CollabRx 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, Cover-All Technologies ( COVR) was up $0.03 (2.5%) to $1.08 on light volume. Throughout the day, 13,120 shares of Cover-All Technologies exchanged hands as compared to its average daily volume of 27,000 shares. The stock ranged in a price between $1.04-$1.08 after having opened the day at $1.04 as compared to the previous trading day's close of $1.05.

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 $28.5 million and is part of the technology sector. Shares are down 25.0% year-to-date as of the close of trading on Friday. Currently there are no analysts who rate Cover-All Technologies 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 Cover-All Technologies as a sell. The company's weaknesses can be seen in multiple areas, such as its weak operating cash flow and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on COVR go as follows:

  • Net operating cash flow has decreased to $1.35 million or 49.22% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • COVR has underperformed the S&P 500 Index, declining 16.41% 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.
  • 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, COVER-ALL TECHNOLOGIES INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • 47.81% is the gross profit margin for COVER-ALL TECHNOLOGIES INC which we consider to be strong. Regardless of COVR's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, COVR's net profit margin of 6.55% is significantly lower than the industry average.
  • COVER-ALL TECHNOLOGIES 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 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.

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

Bridgeline Digital ( BLIN) was another company that pushed the Computer Software & Services industry higher today. Bridgeline Digital was up $0.02 (2.8%) to $0.67 on average volume. Throughout the day, 27,526 shares of Bridgeline Digital exchanged hands as compared to its average daily volume of 28,700 shares. The stock ranged in a price between $0.65-$0.67 after having opened the day at $0.67 as compared to the previous trading day's close of $0.65.

Bridgeline Digital, Inc. develops iAPPS Web engagement management product platform and related digital solutions in the United States. Its iAPPS platform enables companies and developers to create Websites, Web applications, and online stores. Bridgeline Digital has a market cap of $14.9 million and is part of the technology sector. Shares are down 35.9% year-to-date as of the close of trading on Friday. Currently there is 1 analyst who rates Bridgeline Digital a buy, no analysts rate it a sell, and none rate it a hold.

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

Highlights from TheStreet Ratings analysis on BLIN 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 Internet Software & Services industry and the overall market, BRIDGELINE DIGITAL INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • BLIN's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 33.99%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last 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.
  • BRIDGELINE DIGITAL INC has improved earnings per share by 40.0% in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, BRIDGELINE DIGITAL INC reported poor results of -$0.23 versus -$0.07 in the prior year. For the next year, the market is expecting a contraction of 26.1% in earnings (-$0.29 versus -$0.23).
  • Despite currently having a low debt-to-equity ratio of 0.31, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Regardless of the somewhat mixed results with the debt-to-equity ratio, the company's quick ratio of 0.95 is weak.
  • Net operating cash flow has increased to -$1.22 million or 14.87% when compared to the same quarter last year. Despite an increase in cash flow, BRIDGELINE DIGITAL INC's cash flow growth rate is still lower than the industry average growth rate of 41.40%.

You can view the full analysis from the report here: Bridgeline Digital 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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