The Technology sector as a whole was unchanged today versus the S&P 500, which was up 0.1%. Laggards within the Technology sector included Schmitt Industries ( SMIT), down 3.8%, Technical Communications ( TCCO), down 1.6%, Optical Cable ( OCC), down 3.5%, Sajan ( SAJA), down 2.0% and Lantronix ( LTRX), down 3.0%.

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

Telecom Italia SpA ( TI) is one of the companies that pushed the Technology sector lower today. Telecom Italia SpA was down $0.31 (2.3%) to $13.14 on light volume. Throughout the day, 29,582 shares of Telecom Italia SpA exchanged hands as compared to its average daily volume of 390,000 shares. The stock ranged in price between $13.03-$13.19 after having opened the day at $13.19 as compared to the previous trading day's close of $13.45.

Telecom Italia S.p.A., together with its subsidiaries, provides fixed and mobile telecommunications services. Telecom Italia SpA has a market cap of $26.2 billion and is part of the telecommunications industry. Shares are up 27.6% year-to-date as of the close of trading on Tuesday. Currently there are 2 analysts who rate Telecom Italia SpA a buy, no analysts rate it a sell, and 2 rate it a hold.

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TheStreet Ratings rates Telecom Italia SpA as a hold. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, solid stock price performance and expanding profit margins. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, generally higher debt management risk and weak operating cash flow.

Highlights from TheStreet Ratings analysis on TI go as follows:

  • 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, despite the company's weak earnings results. Despite the fact that it has already risen in the past year, there is currently no conclusive evidence that warrants the purchase or sale of this stock.
  • 39.78% is the gross profit margin for TELECOM ITALIA SPA - NEW which we consider to be strong. Regardless of TI'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 1.56% trails the industry average.
  • Although TI's debt-to-equity ratio of 2.21 is very high, it is currently less than that of the industry average.
  • Net operating cash flow has significantly decreased to $166.49 million or 65.57% 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: Telecom Italia SpA Ratings Report

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At the close, Lantronix ( LTRX) was down $0.04 (3.0%) to $1.27 on light volume. Throughout the day, 3,175 shares of Lantronix exchanged hands as compared to its average daily volume of 11,900 shares. The stock ranged in price between $1.25-$1.28 after having opened the day at $1.25 as compared to the previous trading day's close of $1.31.

Lantronix, Inc. designs, develops, markets, and sells networking and communications products in the Americas, Europe, the Middle East, Africa, the Asia Pacific, and Japan. Lantronix has a market cap of $19.4 million and is part of the telecommunications industry. Shares are down 30.7% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates Lantronix a buy, no analysts rate it a sell, and none rate it a hold.

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TheStreet Ratings rates Lantronix as a sell. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.

Highlights from TheStreet Ratings analysis on LTRX go as follows:

  • 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 Communications Equipment industry. The net income has significantly decreased by 545.4% when compared to the same quarter one year ago, falling from -$0.13 million to -$0.84 million.
  • 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 Communications Equipment industry and the overall market, LANTRONIX INC's return on equity significantly trails that of both the industry average and the S&P 500.
  • The share price of LANTRONIX INC has not done very well: it is down 25.00% and has underperformed the S&P 500, in part reflecting the company's sharply declining earnings per share when compared to the year-earlier quarter. 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.
  • LANTRONIX INC has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from 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, LANTRONIX INC continued to lose money by earning -$0.06 versus -$0.19 in the prior year. For the next year, the market is expecting a contraction of 183.3% in earnings (-$0.17 versus -$0.06).
  • 46.46% is the gross profit margin for LANTRONIX INC which we consider to be strong. Regardless of LTRX's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, LTRX's net profit margin of -8.03% significantly underperformed when compared to the industry average.

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

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Sajan ( SAJA) was another company that pushed the Technology sector lower today. Sajan was down $0.10 (2.0%) to $5.00 on light volume. Throughout the day, 1,251 shares of Sajan exchanged hands as compared to its average daily volume of 2,700 shares. The stock ranged in price between $4.99-$5.00 after having opened the day at $4.99 as compared to the previous trading day's close of $5.10.

Sajan has a market cap of $24.4 million and is part of the telecommunications industry. Shares are down 9.7% year-to-date as of the close of trading on Tuesday. Currently there is 1 analyst who rates Sajan a buy, no analysts rate it a sell, and none rate it a hold.

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