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Tickers in this Article: IRF, ADTN, HPQ, QIHU, LMNX, SNPS, CRUS
The market is currently down, with the Nasdaq decreasing 0.2%, the S&P 500 falling 0.4% and the Dow declining 0.6%. The technology sector is a category of stocks relating to the research, development and/or distribution of technologically based goods and services. This sector contains businesses revolving around the manufacturing of electronics, creation of software, computers or products and services relating to information technology. The technology sector offers a wide arrange of products and services for both customers and other businesses. Consumer goods like personal computers, stereos and televisions are continually improved and upgraded, offering the latest technology to all users. Businesses receive information and services from software and database systems, which allow the companies to make strategic business decisions.

The Technology sector (XLK) is down 0.3%, underperforming the market overall. The current biggest movers in the sector are:
CompanyMarket CapPercentage Change
International (NYSE:IRF)$1.28 billion-8.8%
ADTRAN (Nasdaq:ADTN)$1.45 billion-8%
Hewlett-Packard (NYSE:HPQ)$37.86 billion-6.4%
QIHOO 360 (NYSE:QIHU)$2.84 billion-6.2%
Luminex (Nasdaq:LMNX)$773.1 million+5.5%
Synopsys (Nasdaq:SNPS)$4.66 billion+4.7%
Cirrus Logic (Nasdaq:CRUS)$2.54 billion+4.1%
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International (NYSE:IRF) has fallen 8.8% and is currently trading at $16.85 per share. At 530,391 shares, the company's volume so far today is 1.6 times its current three-month average. If a stock is trading on low volume, then there is not much interest in the stock. On the other hand, if a stock is trading on high volume, then there is a lot of interest in the stock. Valuation ratios like the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield are useful in determining how attractive a potential or existing investment is. The price/sales ratio measures a company's stock market price by its revenues. IRF has a high P/S ratio of 1.45. This could be a good sign if the share price increases. All things being equal, a low P/S ratio is good news for investors, while a very high one can be a warning sign.

ADTRAN (Nasdaq:ADTN) is trading at $21.05 per share, down 8%. So far today, 1.4 million shares of the company's stock have changed hands. Yesterday's volume was only 795,592 shares. As a stock moves up or down, it is important to pay attention to the trading volume. This indicates the level of interest: the higher the volume, the more the interest. Valuation ratios allow the investor to make a quick determination as to a company's investment value. The price/earnings to growth (PEG) ratio divides a company's P/E ratio by its growth rate of earnings-per-share. ADTN's PEG ratio is 1.51. Because of the adjustment for earnings growth rate, the PEG ratio is somewhat more useful than many formulas for comparing companies in different industries.

Hewlett-Packard (NYSE:HPQ) is currently trading at a share price of $17.98, a 6.4% decline. The company's volume is currently 41.8 million shares for the day, 2.2 times the average daily volume. Volume is also used as a secondary indicator to help confirm what the price movement is suggesting. When estimating the value of a particular investment, valuation ratios provide a good basis for assessing the value of an individual stock. To a large degree, the debt-equity (D/E) ratio provides another vantage point on a company's leverage position, in this case, comparing total liabilities to shareholders' equity, as opposed to total assets in the debt ratio. HPQ has a D/E ratio of 73%. The D/E ratio is not a pure measurement of a company's debt because it includes operational liabilities in total liabilities.

After a decline of 6.2%, QIHOO 360 (NYSE:QIHU) has hit a share price of $23.05. So far today, the company's volume is 3.6 million shares. Volume is used to evaluate how meaningful the price movement of a stock is. In making a decision about a potential or existing investment, valuation ratios are useful as a basis for seeing whether the stock price is too high, reasonable, or a bargain. The debt ratio shows the proportion of assets that a company is financing through debt. QIHU's debt ratio of 13.1% is on the low side. This indicates that the company engages in conservative financing with opportunities to borrow in the future at no significant risk. As with all financial ratios, a company's debt ratio should be compared with the industry average or similar companies.

After an increase of 5.5%, Luminex (Nasdaq:LMNX) has reached a current price of $19.43. So far today, the company's volume is 169,522 shares, 0.7 times the current three-month average. If a stock price makes a big move up or down, volume lets us know the significance of that move. Investment valuation ratios provide investors with an estimation, albeit a simplistic one, of the value of a stock. One of the most important estimates of stock market valuation is the price/earnings ratio (P/E ratio). Compared to the industry average of 45.31, LMNX's P/E ratio of 64.8 is quite high. A company with a high P/E ratio will eventually have to live up to the high rating by substantially increasing its earnings, or the price will need to drop. From the investor's perspective, a stock with a lower ratio is relatively cheaper than a stock with a higher ratio. SEE: Understanding The P/E Ratio

Synopsys (Nasdaq:SNPS) has risen 4.7% to hit a current price of $33.15 per share. The company's volume for the day so far is 1.5 million shares. This is greater than yesterday's volume of 704,262 shares. If a stock price moves on high volume, this means that the change is a significant one. Looking at a company's valuation ratios is a good way of getting a basic idea as to its value as an investment. A company's capitalization (not to be confused with its market capitalization) is the term used to describe the makeup of a company's permanent or long-term capital, which consists of both long-term debt and shareholders' equity. SNPS has a low capitalization ratio of 5%. A low capitalization ratio can signify a failure to leverage equity into investment, missing valuable opportunities for growth and expansion. Prudent use of leverage (debt) increases the financial resources available to a company for growth and expansion.

Cirrus Logic (Nasdaq:CRUS) has increased to a share price of $40.98, a 4.1% rise. So far today, the company's volume is 1.8 million shares, 0.9 times its current daily average. In technical analysis, trading volume is used to determine the strength of a market indicator. Valuation ratios include the price to earnings (P/E) ratio, the price to earnings growth (PEG) ratio, the price to sales (P/S) ratio, the price to book (P/B) ratio, and the dividend yield. The price/book value ratio is especially important for value investors as it can provide an indication of the true value of a company's assets at a time when its business model may be failing. The P/B ratio for CRUS is 5.54, indicating that the stock is trading for more than its book value. This implies that investors expect management to create more value from a given set of assets and/or that the market value of the firm's assets is significantly higher than their accounting value. P/B has its shortcomings but is still widely used as a valuation metric, more relevant for use by investors looking at capital-intensive or finance-related businesses, such as banks; book value does not carry much meaning for service-based firms with few tangible assets. SEE: Using The Price-To-Book Ratio To Evaluate Companies

The Bottom Line The nature of the market is such that stocks will have good days and bad days. Paying close attention to the previous ratios will help you identify key times to adjust your strategy. Keep in mind that all these ratios should be compared against historical numbers and industry information in order to get a more complete picture.

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