ZetaKap's  Instablog

Send Message
ZetaKap Media is a financial news media outlet that provides fresh, accurate, and actionable news. If you devour financial news, look no further than ZetaKap. Follow ZetaKap on twitter for the latest financial news updates: @zetakap
My company:
ZetaKap Media
My blog:
ZetaKap Media
  • 5 Undervalued Technology Stocks With Killer Profits 0 comments
    Apr 28, 2012 8:32 PM | about stocks: ACLS, ADAT, CMVT, CY, CSGS

    Interested in technology stocks? Looking for undervalued stocks? Do you prefer companies with strong profits? For a closer look at stocks of this nature, we ran a screen.

    The forward P/E is a price multiple valuation metric, which is similar to the current P/E ratio, except that it uses the forecasted earnings instead. While this number might not be as accurate because it uses "forecasted" numbers, it does offer the benefit of illustrating analysts' expectations of a firm. If the market believes that earnings will grow moving forward, then the forward P/E should be lower than the current P/E. Financial Leverage, also known as the Equity Multiplier, illustrates how a firm is financing its assets. The lower the number the more a firm is financing its assets internally through stockholder equity. The higher this metric is the more the firm is relying on debt to finance its assets.

    EPS growth (earnings per share growth) illustrates the growth of earnings per share over time. EPS growth rates help investors identify stocks that are increasing or decreasing in profitability. This profitability metric is generally a key driver in the price of the stock as it directly correlates to the profitability of the company as a whole.

    We first looked for Technology stocks with a low price-multiple premium (forward P/E<10) and that have shown strong bottom line growth over the last year (1-year fiscal EPS growth rate>10%). We did not screen out any market caps.

    Do you think these technology stocks will outperform? Please use our list to assist your own analysis.

    1) Spansion Inc. (CODE)

    Sector: Technology
    Industry: Semiconductor- Memory Chips
    Market Cap: $651.13M
    Beta: -

    Spansion Inc. has a Forward Price/Equity Ratio of 6.56 and Earnings Per Share Growth of 238.98%. The short interest was 4.17% as of 04/25/2012. Spansion Inc. engages in the design, development, manufacture, and sale of flash memory semiconductors worldwide. It offers flash memory solutions for microprocessors, controllers, and other programmable semiconductors that run applications in a range of electronic systems, including automotive and industrial, computing and communications, and consumer and gaming. The company's product designs are primarily based on its proprietary two-bit-per-cell MirrorBit technology.

    2) Comverse Technology Inc. (NASDAQ:CMVT)

    Sector: Technology
    Industry: Communication Equipment
    Market Cap: $1.41B
    Beta: 1.18

    Comverse Technology Inc. has a Forward Price/Equity Ratio of 9.91 and Earnings Per Share Growth of 52.31%. The short interest was 0.82% as of 04/25/2012. Comverse Technology, Inc., through its subsidiaries, provides software-based products, systems, and related services for wireless, wireline, and cable network communication service providers. It products offer converged, prepaid, and postpaid billing and active customer management systems; enable wireless, wireline, and cable network-based value-added services (VAS), such as voicemail, visual voicemail, call completion, short messaging service, text messaging, multimedia picture and video messaging, and Internet protocol communications; and provide wireless users with optimized access to Internet Websites, content and applications, manage and enforce policy, and generate data usage. The company also provides Actionable Intelligence solutions to capture, distill, and analyze complex and underused information sources, such as voice, video, and unstructured text, as well as maintenance and support, managed, and training services.

    3) CSG International, Inc. (NASDAQ:CSGS)

    Sector: Technology
    Industry: Business Software & Services
    Market Cap: $486.69M
    Beta: 0.93

    CSG International, Inc. has a Forward Price/Equity Ratio of 6.99 and Earnings Per Share Growth of 89.41%. The short interest was 3.94% as of 04/25/2012. CSG Systems International, Inc. provides business support solutions primarily to the communications industry. Its suite of solutions comprises Advanced Convergent Platform, a billing and customer care, and business optimization platform; Singleview suite, an integrated customer care, billing, and real-time rating and charging solution; Total Service Mediation (NYSE:TSM) framework supports offline, and real-time mediation requirements, as well as service activation; and Wholesale Business Management (WBM) solution, a wholesale settlement and routing solution that handles various types of traffic consisting of voice, data, and content. The company's solutions also include customer interaction management solutions that deliver interactive voice, SMS/text, print, email, Web, and fax messages on behalf of clients; analytics and intelligence services suite delivers an approach for enhancing the customer experience, increasing sales opportunities, and optimizing business; and Content Direct solutions, which enable content providers to manage subscriber preferences and offer digital content.

    4) Authentidate Holding Corp. (NASDAQ:ADAT)

    Sector: Technology
    Industry: Healthcare Information Services
    Market Cap: $37.65M
    Beta: 1.14

    Authentidate Holding Corp. has a Forward Price/Equity Ratio of 10.00 and Earnings Per Share Growth of 35.52%. The short interest was 2.24% as of 04/25/2012. Authentidate Holding Corp. provides secure Web-based software applications and telehealth products and services in the United States. It offers Inscrybe Healthcare, a Web-based health information exchange and workflow automation solution that enables healthcare industry participants to exchange and track a range of documents, certificates, authorizations, and other information over various modes of communication, including electronic and fax delivery; Inscrybe Office, a Web-based service to sign, seal, and confirm receipt of important documents; and AuthentiProof, a content integrity and time-and-date stamp application. The company also provides the in-home ExpressMD solution, which integrates Electronic House Call in-home patient vital signs monitoring system with a software interface based on the Inscrybe Healthcare platform.

    5) Axcelis Technologies Inc. (NASDAQ:ACLS)

    Sector: Technology
    Industry: Semiconductor Equipment & Materials
    Market Cap: $161.78M
    Beta: 2.48

    Axcelis Technologies Inc. has a Forward Price/Equity Ratio of 7.19 and Earnings Per Share Growth of 127.68%. The short interest was 2.51% as of 04/25/2012. Axcelis Technologies, Inc., together with its subsidiaries, designs, manufactures, and services ion implantation, dry strip, and other processing equipment used in the fabrication of semiconductor chips in the United States, Europe, and the Asia Pacific. It offers a line of high energy, high current, and medium current ion implanters for various applications, such as line of single wafer implanters, known as the Optima platform, comprising the Optima XE, the Optima HD, and the Optima MD. The company also offers dry strip tools, including the Integra RS, which comprises paired-chamber process modules.

    *Company profiles were sourced from Finviz. Financial data was sourced from Google Finance and Yahoo Finance.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Stocks: ACLS, ADAT, CMVT, CY, CSGS
Back To ZetaKap's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers


More »
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.