Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 3 stocks made the list for top value stocks in the Technology Hardware, Storage & Peripherals industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Technology Hardware, Storage & Peripherals Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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3 Undervalued Technology Hardware, Storage & Peripherals Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 3 undervalued stocks in the Technology Hardware, Storage & Peripherals industry for Monday, October 07, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Technology Hardware, Storage & Peripherals industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Qualstar Corporation’s Value Grade

Value Grade:

Qualstar Corporation manufactures and markets data storage system products and power solutions worldwide. The company operates in two segments, Data Storage and Power Supplies. It provides data storage systems under the Qualstar brand and power solutions under the N2Power brand. The company designs, manufactures, and sells switching power supplies that are used to convert AC line voltage to DC voltages; or DC voltages to other DC voltages for use in various electronic equipment, such as communications equipment, industrial machine tools, and wireless systems, as well as medical and gaming devices. It also supports and sells data storage devices used to store, retrieve, and manage electronic data primarily in network computing environments. The company serves resellers, system integrators, and original equipment manufacturers, including OEMs in various markets, such as telecom/networking equipment, audio/visual, industrial, gaming and medical industries. Qualstar Corporation was incorporated in 1984 and is based in Irvine, California.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Qualstar Corporation has a Value Score of 65, which is considered to be undervalued.

When you look at Qualstar Corporation’s price-to-sales ratio at 0.53 compared to the industry median at 0.94, this company has a lower price relative to revenue compared to its peers. This could make Qualstar Corporation’s stock more attractive for value investors.

Qualstar Corporation’s price-earnings ratio is 134.50 compared to the industry median at 16.10. This means it has a higher share price relative to earnings compared to its peers. This could make Qualstar Corporation less attractive for value investors.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Qualstar Corporation’s shareholder yield is higher than its industry median ratio of (1.10%). Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Qualstar Corporation’s price-to-book ratio is lower than its industry median ratio of 1.14. This could make Qualstar Corporation more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Qualstar Corporation’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Qualstar Corporation’s price-to-free-cash-flow ratio is lower than its industry median ratio of 15.70. This could make Qualstar Corporation more attractive because the lower P/FCF ratio indicates that Qualstar Corporation is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Socket Mobile, Inc.’s Value Grade

Value Grade:

Socket Mobile, Inc. provides data capture and delivery solutions in the United States, Europe, Asia, and internationally. Its products and solutions are integrated into mobile applications for applications in the areas of point of sale, commercial services, asset tracking, manufacturing and quality control processes, transportation and logistics, event management, medical, and education. The company also offers cordless data capture devices that connect through Bluetooth and work with applications running on smartphones, mobile computers, and tablets; SocketScan and DuraScan 700 series, companion scanners and 800 series, attachable scanners, and wearables; and DuraSled, a barcode scanning sled that protects phones from impact damage and provides charging solutions. In addition, it offers D600, a handheld model to reads and writes various types of electronic SmartTags and transfers data with near-field communication (NFC); S550, a contactless membership card reader/writer; and S370 product that supports barcode scanning, and NFC reading and writing technologies. Further, the company provides SocketCam C820 and C860, which are camera-based barcode scanners; software developer kits, such as CaptureSDK that enables the App providers to modify captured data, control the placement of the barcoded or RFID data in their applications, and control the feedback to the user. It serves retail, commercial services, industrial and manufacturing, transportation and logistics, and healthcare industries through a network of distributors, online resellers, and application providers, as well as online stores. The company was formerly known as Socket Communications, Inc. and changed its name to Socket Mobile, Inc. in April 2008. Socket Mobile, Inc. was founded in 1992 and is headquartered in Fremont, California.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Socket Mobile, Inc. has a Value Score of 74, which is considered to be undervalued.

Socket Mobile, Inc.’s price-to-book ratio is higher than its peers. This could make Socket Mobile, Inc. less attractive for value investors when compared to the industry median at 1.14.

You can read more about Socket Mobile, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Sonim Technologies, Inc.’s Value Grade

Value Grade:

Sonim Technologies, Inc. provides ruggedized mobile phones and accessories for task workers. The company offers ruggedized mobile phones, such as Sonim XP10, Sonim XP5plus, Sonim XP3plus, and Sonim XP Pro; Sonim mobile hotspot; industrial-grade accessories. It sells its mobile phones and accessories primarily to wireless carriers in the United States and Canada; and sells wireless carrier channels through distribution channels in North America and Europe. The company serves transportation and logistics, construction, manufacturing, facilities management, energy and utility, mining, and public safety sectors. The company was formerly known as NaviSpin.com, Inc. and changed its name to Sonim Technologies, Inc. in December 2001. Sonim Technologies, Inc. was incorporated in 1999 and is headquartered in San Diego, California.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Sonim Technologies, Inc. has a Value Score of 75, which is considered to be undervalued.

Sonim Technologies, Inc.’s price-to-book ratio is higher than its peers. This could make Sonim Technologies, Inc. less attractive for value investors when compared to the industry median at 1.14.

You can read more about Sonim Technologies, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Technology Hardware, Storage & Peripherals Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Technology Hardware, Storage & Peripherals stocks as well as other industrys.

Choosing Which of the 3 Best Technology Hardware, Storage & Peripherals Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Qualstar Corporation stock has a Value Grade of B.
• Socket Mobile, Inc. stock has a Value Grade of B.
• Sonim Technologies, Inc. stock has a Value Grade of B.

Now that you have a bit more background about each of the 3 undervalued stocks in the Technology Hardware, Storage & Peripherals industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Technology Hardware, Storage & Peripherals Stocks

Want to learn more about Technology Hardware, Storage & Peripherals stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 3 Undervalued Technology Hardware, Storage & Peripherals Stocks for Monday, October 07
• 4 Undervalued Technology Hardware, Storage & Peripherals Stocks for Friday, October 04
• 3 Undervalued Technology Hardware, Storage & Peripherals Stocks for Thursday, October 03
• Mutual Funds Converting to ETFs for Tax Efficiency and Convenience

AAII Disclaimer

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