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.

All three major indices traded up today with the Dow Jones Industrial Average ( ^DJI) trading up 140 points (0.8%) at 17,869 as of Tuesday, Feb. 10, 2015, 4:20 PM ET. The NYSE advances/declines ratio sits at 1,747 issues advancing vs. 1,330 declining with 126 unchanged.

The Telecommunications industry as a whole closed the day up 0.3% versus the S&P 500, which was up 1.1%. Top gainers within the Telecommunications industry included Glowpoint ( GLOW), up 2.0%, Voltari ( VLTC), up 3.3%, RELM Wireless ( RWC), up 2.2%, Wireless Telecom Group ( WTT), up 1.5% and RIT Technologies ( RITT), up 7.4%.

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

RIT Technologies ( RITT) is one of the companies that pushed the Telecommunications industry higher today. RIT Technologies was up $0.09 (7.4%) to $1.30 on heavy volume. Throughout the day, 373,963 shares of RIT Technologies exchanged hands as compared to its average daily volume of 112,000 shares. The stock ranged in a price between $1.25-$1.49 after having opened the day at $1.48 as compared to the previous trading day's close of $1.21.

RIT Technologies has a market cap of $15.3 million and is part of the technology sector. Shares are up 26.0% year-to-date as of the close of trading on Monday.

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, RELM Wireless ( RWC) was up $0.12 (2.2%) to $5.55 on heavy volume. Throughout the day, 34,323 shares of RELM Wireless exchanged hands as compared to its average daily volume of 15,900 shares. The stock ranged in a price between $5.46-$5.56 after having opened the day at $5.50 as compared to the previous trading day's close of $5.43.

RELM Wireless Corporation designs, manufactures, and markets wireless communications products under the BK Radio and RELM brand names in the United States and internationally. Its products include two-way land mobile radios, repeaters, base stations, and related components and subsystems. RELM Wireless has a market cap of $74.5 million and is part of the technology sector. Shares are up 13.1% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate RELM Wireless 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 RELM Wireless as a buy. 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, compelling growth in net income, solid stock price performance and impressive record of earnings per share growth. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from TheStreet Ratings analysis on RWC go as follows:

  • The revenue growth came in higher than the industry average of 5.2%. Since the same quarter one year prior, revenues rose by 14.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • RWC's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 3.89, which clearly demonstrates the ability to cover short-term cash needs.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the Communications Equipment industry average. The net income increased by 27.4% when compared to the same quarter one year prior, rising from $0.51 million to $0.66 million.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 68.92% over the past year, a rise that has exceeded that of the S&P 500 Index. We feel that the stock's sharp appreciation over the last year has driven it to a price level which is now somewhat expensive compared to the rest of its industry. The other strengths this company shows, however, justify the higher price levels.
  • RELM WIRELESS CORP has improved earnings per share by 25.0% 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, RELM WIRELESS CORP reported lower earnings of $0.08 versus $0.16 in the prior year.

You can view the full analysis from the report here: RELM Wireless 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.

Glowpoint ( GLOW) was another company that pushed the Telecommunications industry higher today. Glowpoint was up $0.02 (2.0%) to $1.04 on light volume. Throughout the day, 5,041 shares of Glowpoint exchanged hands as compared to its average daily volume of 17,100 shares. The stock ranged in a price between $1.04-$1.05 after having opened the day at $1.05 as compared to the previous trading day's close of $1.02.

Glowpoint, Inc. provides video collaboration services and network solutions in the United States. The company offers managed videoconferencing as a cloud-based service with videoconferences hosted in the Glowpoint Cloud and as on-premise solution. Glowpoint has a market cap of $38.7 million and is part of the technology sector. Shares are down 1.8% year-to-date as of the close of trading on Monday. Currently there are no analysts who rate Glowpoint a buy, no analysts rate it a sell, and none rate it a hold.

TheStreet Ratings rates Glowpoint as a sell. The company's weaknesses can be seen in multiple areas, such as its disappointing return on equity, weak operating cash flow, generally disappointing historical performance in the stock itself and generally high debt management risk.

Highlights from TheStreet Ratings analysis on GLOW 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 Internet Software & Services industry and the overall market, GLOWPOINT 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 $0.31 million or 31.44% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • GLOW'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 26.25%, 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 debt-to-equity ratio of 1.17 is relatively high when compared with the industry average, suggesting a need for better debt level management. Even though the debt-to-equity ratio is weak, GLOW's quick ratio is somewhat strong at 1.21, demonstrating the ability to handle short-term liquidity needs.
  • GLOW, with its decline in revenue, underperformed when compared the industry average of 9.5%. Since the same quarter one year prior, revenues slightly dropped by 4.3%. 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: Glowpoint 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.

More from Markets

Stocks Drift, Oil Steadies, Dollar Dips as Investors Question Growth Prospects

Stocks Drift, Oil Steadies, Dollar Dips as Investors Question Growth Prospects

Netflix, Amazon, Jerome Powell, Walmart and Microsoft - 5 Things You Must Know

Netflix, Amazon, Jerome Powell, Walmart and Microsoft - 5 Things You Must Know

Did Netflix Earnings Just Stomp Out Any Chance of a Big Market Rally?

Did Netflix Earnings Just Stomp Out Any Chance of a Big Market Rally?

Netflix's Subscriber Miss and 4 Other Stories to Watch Premarket Tuesday

Netflix's Subscriber Miss and 4 Other Stories to Watch Premarket Tuesday

3 Stocks Poised to Move the Markets This Week: Goldman Sachs, Microsoft, GE

3 Stocks Poised to Move the Markets This Week: Goldman Sachs, Microsoft, GE