NEW YORK (TheStreet) -- Are the worst performing tech stocks of the first quarter also bad for your portfolio?

Three months ago, yes. Today, not necessarily.

The S&P 500 Information Technology Index rose just 0.17% for the first three months of the year, compared to an increase of 0.44% for the broader S&P 500 Index for the same time period.

TheStreet paired the 10 worst tech performers with TheStreet Ratings to determine whether the poorest performers really are bad overall investments going forward.

TheStreet Ratings, TheStreet's proprietary ratings tool, projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Based on 32 major data points, TheStreet Ratings uses a quantitative approach to rating over 4,300 stocks to predict return potential for the next year. The model is both objective, using elements such as volatility of past operating revenues, financial strength, and company cash flows, and subjective, including expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings.

Buying an S&P 500 stock that TheStreet Ratings rated a "buy" yielded a 16.56% return in 2014 beating the S&P 500 Total Return Index by 304 basis points. Buying a Russell 2000 stock that TheStreet Ratings rated a "buy" yielded a 9.5% return in 2014, beating the Russell 2000 index, including dividends reinvested, by 460 basis points last year.

Check out which stocks were among the worst tech performers in the S&P 500 to date. And when you're done with that be sure to find out which company had the worst overall performance in the S&P 500 for the first quarter.

MSFT Chart MSFT data by YCharts

10. Microsoft Corp. (MSFT - Get Report)
Market Cap: $333 billion
Year-to-date return: -12.48%
TheStreet Ratings: Buy, A-

Microsoft Corporation develops, licenses, markets, and supports software, services, and devices worldwide. The company's Devices and Consumer (D&C) Licensing segment licenses Windows operating system and related software; Microsoft Office for consumers; and Windows Phone operating system.

"We rate MICROSOFT CORP (MSFT) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, reasonable valuation levels, largely solid financial position with reasonable debt levels by most measures, expanding profit margins and notable return on equity. We feel these strengths outweigh the fact that the company has had subpar growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Despite its growing revenue, the company underperformed as compared with the industry average of 10.0%. Since the same quarter one year prior, revenues slightly increased by 8.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • 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. Despite the fact that MSFT's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.24 is high and demonstrates strong liquidity.
  • The gross profit margin for MICROSOFT CORP is rather high; currently it is at 67.45%. Regardless of MSFT's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 22.14% trails the industry average.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Software industry and the overall market, MICROSOFT CORP's return on equity exceeds that of both the industry average and the S&P 500.

 

 

 

INTC Chart INTC data by YCharts


9. Intel Corp. (INTC - Get Report)
Market Cap: $146.3 billion
Year-to-date return: -13.83%
TheStreet Ratings: Buy, B

Intel Corporation designs, manufactures, and sells integrated digital technology platforms worldwide. It operates through PC Client Group, Data Center Group, Internet of Things Group, Mobile and Communications Group, Software and Services, and All Other segments.

"We rate INTEL CORP (INTC) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity and attractive valuation levels. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Semiconductors & Semiconductor Equipment industry average. The net income increased by 39.5% when compared to the same quarter one year prior, rising from $2,625.00 million to $3,661.00 million.
  • Despite its growing revenue, the company underperformed as compared with the industry average of 10.6%. Since the same quarter one year prior, revenues slightly increased by 6.4%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • INTC's debt-to-equity ratio is very low at 0.24 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.19, which illustrates the ability to avoid short-term cash problems.
  • 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 Semiconductors & Semiconductor Equipment industry and the overall market, INTEL CORP's return on equity exceeds that of both the industry average and the S&P 500.

 

EMC Chart EMC data by YCharts

8. EMC Corp./MA (EMC)
Market Cap: $50.5 billion
Year-to-date return: -14.06%
TheStreet Ratings: Buy, B

EMC Corporation develops, delivers, and supports information infrastructure and virtual infrastructure technologies, solutions, and services.

"We rate EMC CORP/MA (EMC) a BUY. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. 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, expanding profit margins, good cash flow from operations and growth in earnings per share. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • EMC's revenue growth trails the industry average of 31.8%. Since the same quarter one year prior, revenues slightly increased by 5.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Although EMC's debt-to-equity ratio of 0.25 is very low, it is currently higher than that of the industry average. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.09, which illustrates the ability to avoid short-term cash problems.
  • The gross profit margin for EMC CORP/MA is currently very high, coming in at 70.92%. 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 16.25% trails the industry average.
  • Net operating cash flow has slightly increased to $2,231.00 million or 1.87% when compared to the same quarter last year. Despite an increase in cash flow, EMC CORP/MA's cash flow growth rate is still lower than the industry average growth rate of 51.72%.
  • EMC CORP/MA has improved earnings per share by 16.7% 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, EMC CORP/MA reported lower earnings of $1.31 versus $1.33 in the prior year. This year, the market expects an improvement in earnings ($1.98 versus $1.31).

 

 

 

NTAP Chart NTAP data by YCharts


7. NetApp Inc. (NTAP - Get Report)
Market Cap: $11 billion
Year-to-date return: -14.45%
TheStreet Ratings: Buy, B

NetApp, Inc. is engaged in design, manufacture, and marketing of networked storage solutions. The company provides storage and data management software, systems, and services.

"We rate NETAPP INC (NTAP) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its growth in earnings per share, expanding profit margins, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • NETAPP INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, NETAPP INC increased its bottom line by earning $1.85 versus $1.37 in the prior year. This year, the market expects an improvement in earnings ($2.78 versus $1.85).
  • The gross profit margin for NETAPP INC is rather high; currently it is at 68.13%. It has increased from the same quarter the previous year. Despite the strong results of the gross profit margin, NTAP's net profit margin of 11.39% significantly trails the industry average.
  • Despite currently having a low debt-to-equity ratio of 0.43, it is higher than that of the industry average, inferring that management of debt levels may need to be evaluated further. Despite the fact that NTAP's debt-to-equity ratio is mixed in its results, the company's quick ratio of 2.38 is high and demonstrates strong liquidity.
  • 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 Computers & Peripherals industry and the overall market on the basis of return on equity, NETAPP INC has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • The revenue fell significantly faster than the industry average of 31.8%. Since the same quarter one year prior, revenues slightly dropped by 3.6%. The declining revenue has not hurt the company's bottom line, with increasing earnings per share.

 

KLAC Chart KLAC data by YCharts

6. KLA-Tencor Corp. (KLAC - Get Report)
Market Cap: $9.4 billion
Year-to-date return: -17.11%
TheStreet Ratings: Hold, C

KLA-Tencor Corporation designs, manufactures, and markets process control and yield management solutions worldwide.

"We rate KLA-TENCOR CORP (KLAC) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its notable return on equity and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, weak operating cash flow and generally higher debt management risk."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • 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, KLA-TENCOR CORP's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • The gross profit margin for KLA-TENCOR CORP is rather high; currently it is at 60.92%. Regardless of KLAC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, KLAC's net profit margin of 2.99% is significantly lower than the industry average.
  • Net operating cash flow has significantly decreased to $11.08 million or 90.38% when compared to the same quarter last year. In addition, when comparing to the industry average, the firm's growth rate is much lower.
  • The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Semiconductors & Semiconductor Equipment industry. The net income has significantly decreased by 85.4% when compared to the same quarter one year ago, falling from $139.25 million to $20.27 million.

 

 

WDC Chart WDC data by YCharts

5. Western Digital Corp. (WDC)
Market Cap: $21.2 billion
Year-to-date return: -17.79%
TheStreet Ratings: Buy, A

Western Digital Corporation, through its subsidiaries, develops, manufactures, and sells data storage solutions that enable consumers, businesses, governments, and other organizations to create, manage, experience, and preserve digital content.

"We rate WESTERN DIGITAL CORP (WDC) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. 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, growth in earnings per share, notable return on equity and expanding profit margins. We feel these strengths outweigh the fact that the company shows weak operating cash flow."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • Although WDC's debt-to-equity ratio of 0.26 is very low, it is currently higher than that of the industry average. To add to this, WDC has a quick ratio of 2.14, which demonstrates the ability of the company to cover short-term liquidity needs.
  • WESTERN DIGITAL CORP's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, WESTERN DIGITAL CORP increased its bottom line by earning $6.69 versus $3.90 in the prior year. This year, the market expects an improvement in earnings ($8.30 versus $6.69).
  • 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 Computers & Peripherals industry and the overall market on the basis of return on equity, WESTERN DIGITAL CORP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • 36.01% is the gross profit margin for WESTERN DIGITAL CORP which we consider to be strong. Regardless of WDC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, WDC's net profit margin of 11.26% is significantly lower than the industry average.

 

STX Chart STX data by YCharts


4. Seagate Technology Public Limited Co. (STX - Get Report)
Market Cap: $17 billion
Year-to-date return: -21.76%
TheStreet Ratings: Buy, A-

Seagate Technology Public Limited Company designs, manufactures, and sells electronic data storage products in the Asia Pacific, the Americas, and EMEA countries.

"We rate SEAGATE TECHNOLOGY PLC (STX) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, good cash flow from operations, impressive record of earnings per share growth and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Computers & Peripherals industry. The net income increased by 118.0% when compared to the same quarter one year prior, rising from $428.00 million to $933.00 million.
  • STX's revenue growth trails the industry average of 31.8%. Since the same quarter one year prior, revenues slightly increased by 4.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Net operating cash flow has significantly increased by 68.57% to $1,443.00 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 51.72%.
  • SEAGATE TECHNOLOGY PLC 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, SEAGATE TECHNOLOGY PLC reported lower earnings of $4.52 versus $4.79 in the prior year. This year, the market expects an improvement in earnings ($4.87 versus $4.52).
  • 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 Computers & Peripherals industry and the overall market, SEAGATE TECHNOLOGY PLC's return on equity significantly exceeds that of both the industry average and the S&P 500.

 

 

 

HPQ Chart HPQ data by YCharts

3. Hewlett-Packard Co. (HPQ - Get Report)
Market Cap: $57 billion
Year-to-date return: -22.35%
TheStreet Ratings: Buy, B

Hewlett-Packard Company, together with its subsidiaries, provides products, technologies, software, solutions, and services to individual consumers and small- and medium-sized businesses (SMBs), as well as to the government, health, and education sectors worldwide.

"We rate HEWLETT-PACKARD CO (HPQ) a BUY. This is driven by a few notable strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. Among the primary strengths of the company is its attractive valuation levels, considering its current price compared to earnings, book value and other measures. We feel these strengths outweigh the fact that the company has had sub-par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • HEWLETT-PACKARD CO' earnings per share from the most recent quarter came in slightly below the year earlier quarter. Stable earnings per share over the past year indicate the company has sound management over its earnings and share float. We anticipate these figures will begin to experience more growth in the coming year. During the past fiscal year, HEWLETT-PACKARD CO's EPS of $2.62 remained unchanged from the prior years' EPS of $2.62. This year, the market expects an improvement in earnings ($3.65 versus $2.62).
  • The revenue fell significantly faster than the industry average of 31.8%. Since the same quarter one year prior, revenues slightly dropped by 4.7%. The declining revenue appears to have seeped down to the company's bottom line, decreasing earnings per share.
  • HPQ's debt-to-equity ratio of 0.72 is somewhat low overall, but it is high when compared to the industry average, implying that the management of the debt levels should be evaluated further. Despite the fact that HPQ's debt-to-equity ratio is mixed in its results, the company's quick ratio of 0.67 is low and demonstrates weak liquidity.
  • The company's current return on equity has slightly decreased from the same quarter one year prior. This implies a minor weakness in the organization. Compared to other companies in the Computers & Peripherals industry and the overall market on the basis of return on equity, HEWLETT-PACKARD CO has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.

 

MU Chart MU data by YCharts

2. Micron Technology (MU - Get Report)
Market Cap: $29.4 billion
Year-to-date return: -22.51%
TheStreet Ratings: Buy, A-

Micron Technology, Inc., together with its subsidiaries, provides semiconductor solutions worldwide. The company manufactures and markets dynamic random access memory (DRAM), NAND flash, and NOR flash memory products; and packaging solutions and semiconductor systems.

"We rate MICRON TECHNOLOGY INC (MU) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. 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, notable return on equity, attractive valuation levels and solid stock price performance. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • MU's revenue growth has slightly outpaced the industry average of 10.6%. Since the same quarter one year prior, revenues rose by 13.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • The current debt-to-equity ratio, 0.49, is low and is below the industry average, implying that there has been successful management of debt levels. To add to this, MU has a quick ratio of 1.56, which demonstrates the ability of the company to cover short-term liquidity needs.
  • 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, MICRON TECHNOLOGY INC's return on equity significantly exceeds that of both the industry average and the S&P 500.
  • Looking at where the stock is today compared to one year ago, we find that it is not only higher, but it has also clearly outperformed the rise in the S&P 500 over the same period. Although other factors naturally played a role, the company's strong earnings growth was key. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.

SNDK ChartSNDK data by YCharts

1. SanDisk Corp. (SNDK)
Market Cap: $13.8 billion
Year-to-date return: -35.07%
TheStreet Ratings: Buy, B

SanDisk Corporation designs, develops, manufactures, and markets data storage solutions in the United States and internationally.

"We rate SANDISK CORP (SNDK) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, notable return on equity, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had lackluster performance in the stock itself."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth significantly trails the industry average of 31.8%. Since the same quarter one year prior, revenues slightly increased by 0.4%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • 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 Computers & Peripherals industry and the overall market on the basis of return on equity, SANDISK CORP has underperformed in comparison with the industry average, but has exceeded that of the S&P 500.
  • 48.54% is the gross profit margin for SANDISK CORP which we consider to be strong. Regardless of SNDK's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, SNDK's net profit margin of 11.63% is significantly lower than the industry average.
  • 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 1.50 is sturdy.
  • SANDISK CORP's earnings per share declined by 40.7% in the most recent quarter compared to the same quarter a year ago. The company has suffered a declining pattern of earnings per share over the past year. However, we anticipate this trend reversing over the coming year. During the past fiscal year, SANDISK CORP reported lower earnings of $4.23 versus $4.37 in the prior year. This year, the market expects an improvement in earnings ($4.86 versus $4.23).