3 Computer Hardware Stocks Pushing The 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.

All three major indices are trading down today with the Dow Jones Industrial Average ( ^DJI) trading down 60.59 points (-0.3%) at 17,824 as of Friday, Feb. 6, 2015, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,145 issues advancing vs. 1,963 declining with 115 unchanged.

The Computer Hardware industry as a whole was unchanged today versus the S&P 500, which was down 0.3%. Top gainers within the Computer Hardware industry included Video Display ( VIDE), up 7.7%, Dataram ( DRAM), up 3.6%, Acorn Energy ( ACFN), up 10.7%, Qumu ( QUMU), up 2.5% and Radisys ( RSYS), up 6.2%.

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

Radisys ( RSYS) is one of the companies that pushed the Computer Hardware industry higher today. Radisys was up $0.12 (6.2%) to $2.04 on heavy volume. Throughout the day, 388,859 shares of Radisys exchanged hands as compared to its average daily volume of 121,900 shares. The stock ranged in a price between $1.91-$2.08 after having opened the day at $1.91 as compared to the previous trading day's close of $1.92.

Radisys Corporation operates as a provider of wireless infrastructure solutions in the telecom, aerospace, and defense markets. Radisys has a market cap of $69.3 million and is part of the technology sector. Shares are down 17.9% year-to-date as of the close of trading on Thursday. Currently there are 2 analysts who rate Radisys a buy, no analysts rate it a sell, and 1 rates it a hold.

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TheStreet Ratings rates Radisys as a sell. Among the areas we feel are negative, one of the most important has been a generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on RSYS go as follows:

  • RSYS has underperformed the S&P 500 Index, declining 12.29% 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 Electronic Equipment, Instruments & Components industry and the overall market, RADISYS CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • RSYS, with its decline in revenue, slightly underperformed the industry average of 3.4%. Since the same quarter one year prior, revenues slightly dropped by 3.9%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.
  • Despite currently having a low debt-to-equity ratio of 0.36, 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 0.94 is weak.
  • 36.48% is the gross profit margin for RADISYS CORP which we consider to be strong. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of -9.27% is in-line with the industry average.

You can view the full analysis from the report here: Radisys 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, Qumu ( QUMU) was up $0.37 (2.5%) to $15.00 on light volume. Throughout the day, 3,940 shares of Qumu exchanged hands as compared to its average daily volume of 9,300 shares. The stock ranged in a price between $14.61-$15.19 after having opened the day at $14.76 as compared to the previous trading day's close of $14.63.

Qumu Corporation engages in enterprise video content management software business. The company provides the tools that businesses need to create, manage, secure, distribute, and measure the success of their videos. Qumu has a market cap of $131.3 million and is part of the technology sector. Shares are up 7.0% year-to-date as of the close of trading on Thursday. Currently there are 2 analysts who rate Qumu 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 Qumu as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity and weak operating cash flow.

Highlights from TheStreet Ratings analysis on QUMU 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 Computers & Peripherals industry and the overall market, QUMU 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 -$8.47 million or 436.26% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • In its most recent trading session, QUMU 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.
  • The gross profit margin for QUMU CORP is rather high; currently it is at 50.57%. Despite the high profit margin, it has decreased significantly from the same period last year. Despite the mixed results of the gross profit margin, QUMU's net profit margin of 148.30% significantly outperformed against the industry.
  • QUMU 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. Along with this, the company maintains a quick ratio of 4.44, which clearly demonstrates the ability to cover short-term cash needs.

You can view the full analysis from the report here: Qumu 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.

Acorn Energy ( ACFN) was another company that pushed the Computer Hardware industry higher today. Acorn Energy was up $0.06 (10.7%) to $0.62 on light volume. Throughout the day, 148,635 shares of Acorn Energy exchanged hands as compared to its average daily volume of 227,500 shares. The stock ranged in a price between $0.56-$0.63 after having opened the day at $0.56 as compared to the previous trading day's close of $0.56.

Acorn Energy, Inc., through its subsidiaries, provides technology driven solutions for energy infrastructure asset management worldwide. It offers oil and gas sensor systems, a fiber optic sensing system for the energy, commercial security, and defense markets. Acorn Energy has a market cap of $15.4 million and is part of the technology sector. Shares are down 24.8% year-to-date as of the close of trading on Thursday. Currently there are no analysts who rate Acorn Energy a buy, no analysts rate it a sell, and 1 rates it a hold.

TheStreet Ratings rates Acorn Energy as a sell. The company's weaknesses can be seen in multiple areas, such as its poor profit margins and generally disappointing historical performance in the stock itself.

Highlights from TheStreet Ratings analysis on ACFN go as follows:

  • The gross profit margin for ACORN ENERGY INC is currently lower than what is desirable, coming in at 32.75%. Regardless of ACFN's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, ACFN's net profit margin of -68.25% significantly underperformed when compared to the industry average.
  • ACFN'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 86.38%, 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 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, ACORN ENERGY INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • ACFN's debt-to-equity ratio is very low at 0.26 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 1.00 is somewhat weak and could be cause for future problems.
  • ACORN ENERGY INC reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, ACORN ENERGY INC reported poor results of -$1.60 versus -$0.94 in the prior year. This year, the market expects an improvement in earnings (-$0.71 versus -$1.60).

You can view the full analysis from the report here: Acorn Energy 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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