Top Five Risky Stocks of Technology Sector; Beta Value Analysis – QTM, STP, FNSR, JDSU, STX

  on Jan 03,2013 Posted in Finance ,Investment Ideas
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Beta factor is a gauge for risk of a security when it is included in a well-diversified portfolio. In financial theory, beta is calculated by Capital Asset Pricing Model and breaks down into two components.

The first is considered as systematic risk and would be projected based on covariance with the movements of the market. The second part is the boost in the price of a security that is not explained by the market named as nonsystematic risk. The first part is what Beta captures.

If the Beta is positive, the security price tends to move in the similar direction as the market according to the magnitude of the beta. If a security’s Beta is over 1 so it shows that when the market index goes up 1%, so investors expect the security will go up by over 1%. In this article we will discuss high technology stocks with higher beta value and market volume over two million.

Quantum Corp (NYSE:QTM) offered -9.98% return on assets while the technology company has -20.19% value in Return on investment. Quantum has the market capitalization of 312.99 million while its P/S ratio of 0.50. Beta value for the company is 3.24, which is higher among all technology stocks with market volume over two million. Institutional ownership of the company was 86% while its 240.77 million shares were outstanding. Company’s shares were moving ahead of SMA 20 with 3.75% while lagging behind SMA 50 with 0.05%.

Suntech Power Holdings Co, Ltd (ADR) (NYSE:STP) has market capitalization of 289.34 million and offered -47.95% Return on equity. The company has institutional ownership of 17% while its price to sale ratio was 0.11. Net profit margin of STP was -21.92% while operating profit margin was -13.80%.Beta value for the company was booked as 3.25.

Finisar Corporation (NASDAQ:FNSR) has market capitalization of 1.55 billion while its Price to earnings ratio was 78.24. FNSR has a beta value of 2.82 while offered earning per share of 0.21and its 92.85 million shares were outstanding while the 108% shares were owned by institutional investors. The company has return on equity ratio of 2.77% while return on assets was 2.15%.

JDS Uniphase Corp (NASDAQ:JDSU) has 2.52 beta value, which is a measure of risk. JDS Uniphase has return on equity ratio of -5.86% while its return on investment ratio was -4.47%. Net profit margin of the company was -3.637%. The company has market capitalization of $3.28 billion while its EPS was -0.27. Shares of the company were moving ahead of SMA 50 with 20.32% while SMA 20 with 9.42%.

Seagate Technology PLC (NASDAQ:STX) has market capitalization of 10.78 billion while offered P/E ratio of 4.23. The Beta factor, which is used as a measure of a company’s volatility in relation to the market, was 2.40 while the PEG ratio of the world’s biggest hard disk maker was 0.29. STX has ROE ratio of 111.85% while ROA value remained 36.20%.

Disclosure: Opinions expressed in this article are those of the authors alone who have no stake in any stocks mentioned, and did not plan to acquire any stake within the next 72 hours.



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