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The Electronics industry as a whole closed the day down 3.0% versus the S&P 500, which was down 2.1%. Laggards within the Electronics industry included LGL Group ( LGL), down 2.2%, Electro-Sensors ( ELSE), down 6.2%, Wells-Gardner Electronic ( WGA), down 1.8%, Forward Industries ( FORD), down 2.3% and Data I/O ( DAIO), down 5.2%.

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

ABB ( ABB) is one of the companies that pushed the Electronics industry lower today. ABB was down $0.73 (3.4%) to $20.89 on heavy volume. Throughout the day, 3,461,073 shares of ABB exchanged hands as compared to its average daily volume of 1,721,200 shares. The stock ranged in price between $20.84-$21.41 after having opened the day at $21.37 as compared to the previous trading day's close of $21.62.

ABB Ltd provides power and automation technologies for utility and industrial customers worldwide. ABB has a market cap of $49.3 billion and is part of the industrial goods sector. Shares are down 18.6% year-to-date as of the close of trading on Wednesday. Currently there is 1 analyst who rates ABB a buy, no analysts rate it a sell, and 3 rate it a hold.

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TheStreet Ratings rates ABB as a buy. The company's strengths can be seen in multiple areas, such as its largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels and good cash flow from operations. We feel these strengths outweigh the fact that the company has had sub par growth in net income.

Highlights from TheStreet Ratings analysis on ABB go as follows:

  • The current debt-to-equity ratio, 0.50, is low and is below the industry average, implying that there has been successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.07, which illustrates the ability to avoid short-term cash problems.
  • Net operating cash flow has significantly increased by 63.53% to $888.00 million when compared to the same quarter last year. In addition, ABB LTD has also vastly surpassed the industry average cash flow growth rate of 4.12%.
  • Regardless of the drop in revenue, the company managed to outperform against the industry average of 6.0%. Since the same quarter one year prior, revenues slightly dropped by 0.3%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • ABB LTD's earnings per share declined by 15.2% 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, ABB LTD increased its bottom line by earning $1.22 versus $1.17 in the prior year. This year, the market expects earnings to be in line with last year ($1.22 versus $1.22).

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

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At the close, Data I/O ( DAIO) was down $0.17 (5.2%) to $3.12 on light volume. Throughout the day, 700 shares of Data I/O exchanged hands as compared to its average daily volume of 13,900 shares. The stock ranged in price between $3.10-$3.26 after having opened the day at $3.13 as compared to the previous trading day's close of $3.29.

Data I/O Corporation designs, manufactures, and sells programming systems for electronic device manufacturers worldwide. The company's programming system products are used to program integrated circuits (ICs) with the specific data necessary for the ICs. Data I/O has a market cap of $24.9 million and is part of the industrial goods sector. Shares are up 23.4% year-to-date as of the close of trading on Wednesday.

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TheStreet Ratings rates Data I/O as a hold. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and compelling growth in net income. However, as a counter to these strengths, we find that we feel that the company's cash flow from its operations has been weak overall.

Highlights from TheStreet Ratings analysis on DAIO go as follows:

  • DAIO's revenue growth has slightly outpaced the industry average of 5.8%. Since the same quarter one year prior, revenues slightly increased by 6.2%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • DAIO has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. To add to this, DAIO has a quick ratio of 2.37, which demonstrates the ability of the company to cover short-term liquidity needs.
  • The gross profit margin for DATA I/O CORP is rather high; currently it is at 56.83%. Regardless of DAIO's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, DAIO's net profit margin of 7.98% compares favorably to the industry average.
  • 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 Electronic Equipment, Instruments & Components industry and the overall market, DATA I/O 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 $0.02 million or 94.58% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.

You can view the full analysis from the report here: Data I/O Ratings Report

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LGL Group ( LGL) was another company that pushed the Electronics industry lower today. LGL Group was down $0.08 (2.2%) to $3.54 on light volume. Throughout the day, 1,441 shares of LGL Group exchanged hands as compared to its average daily volume of 4,400 shares. The stock ranged in price between $3.52-$3.71 after having opened the day at $3.55 as compared to the previous trading day's close of $3.62.

The LGL Group, Inc., through its subsidiaries, designs, manufactures, and markets standard and custom-engineered electronic components in the United States and internationally. LGL Group has a market cap of $10.4 million and is part of the industrial goods sector. Shares are down 33.1% year-to-date as of the close of trading on Wednesday.

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

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Highlights from TheStreet Ratings analysis on LGL go as follows:

  • 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 Electronic Equipment, Instruments & Components industry and the overall market, LGL GROUP INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for LGL GROUP INC is currently lower than what is desirable, coming in at 27.40%. It has decreased from the same quarter the previous year. Along with this, the net profit margin of -21.69% is significantly below that of the industry average.
  • Net operating cash flow has significantly decreased to -$0.04 million or 108.23% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • LGL'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 36.68%, 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.
  • LGL GROUP INC 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, LGL GROUP INC reported poor results of -$3.16 versus -$0.51 in the prior year.

You can view the full analysis from the report here: LGL Group 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.