3 Stocks Advancing 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.

All three major indices are trading down today with the Dow Jones Industrial Average ( ^DJI) trading down 49.00 points (-0.3%) at 17,934 as of Wednesday, Dec. 31, 2014, 3:25 PM ET. The NYSE advances/declines ratio sits at 1,635 issues advancing vs. 1,400 declining with 160 unchanged.

The Electronics industry as a whole closed the day up 0.2% versus the S&P 500, which was down 0.7%. Top gainers within the Electronics industry included LGL Group ( LGL), up 8.5%, Sevcon ( SEV), up 2.6%, BTU International ( BTUI), up 7.0%, API Technologies ( ATNY), up 5.5% and Sequans Communications ( SQNS), up 2.5%.

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

API Technologies ( ATNY) is one of the companies that pushed the Electronics industry higher today. API Technologies was up $0.11 (5.5%) to $2.10 on average volume. Throughout the day, 66,488 shares of API Technologies exchanged hands as compared to its average daily volume of 47,100 shares. The stock ranged in a price between $2.03-$2.10 after having opened the day at $2.03 as compared to the previous trading day's close of $1.99.

API Technologies has a market cap of $111.3 million and is part of the technology sector. Shares are down 41.6% year-to-date as of the close of trading on Tuesday.

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, BTU International ( BTUI) was up $0.21 (7.0%) to $3.22 on average volume. Throughout the day, 16,463 shares of BTU International exchanged hands as compared to its average daily volume of 21,500 shares. The stock ranged in a price between $3.05-$3.29 after having opened the day at $3.09 as compared to the previous trading day's close of $3.01.

BTU International, Inc. designs, manufactures, sells, and services thermal processing equipment and related process controls for use in the electronics, alternative energy, automotive, and other industries worldwide. BTU International has a market cap of $26.1 million and is part of the technology sector. Shares are unchanged year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate BTU International a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates BTU International 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 BTUI go as follows:

  • Net operating cash flow has significantly decreased to $0.54 million or 63.84% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • BTUI has underperformed the S&P 500 Index, declining 11.12% 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 Semiconductors & Semiconductor Equipment industry and the overall market, BTU INTERNATIONAL INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • BTU INTERNATIONAL 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, BTU INTERNATIONAL INC reported poor results of -$1.21 versus -$1.16 in the prior year.
  • 39.78% is the gross profit margin for BTU INTERNATIONAL INC which we consider to be strong. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, BTUI's net profit margin of 0.00% significantly trails the industry average.

You can view the full analysis from the report here: BTU International 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.

LGL Group ( LGL) was another company that pushed the Electronics industry higher today. LGL Group was up $0.29 (8.5%) to $3.69 on average volume. Throughout the day, 3,146 shares of LGL Group exchanged hands as compared to its average daily volume of 3,700 shares. The stock ranged in a price between $3.58-$3.69 after having opened the day at $3.67 as compared to the previous trading day's close of $3.40.

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 $8.6 million and is part of the technology sector. Shares are down 37.1% year-to-date as of the close of trading on Tuesday. Currently there are no analysts who rate LGL Group a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates LGL Group 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 LGL go as follows:

  • Net operating cash flow has significantly decreased to -$0.52 million or 316.73% 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 37.86%, 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.
  • 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 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.
  • 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.
  • LGL, with its decline in revenue, underperformed when compared the industry average of 2.6%. Since the same quarter one year prior, revenues slightly dropped by 8.5%. 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: 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.

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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