Axcelis Technologies, Inc. (NASDAQ:ACLS)

ACLS has shown some signs that it is picking up. It underperformed most of the year with weak profits and slow sells. ACLS's second quarter ended well with better than expected profits. Revenues and EPS exceeded the high end of guidance, and the gross margin improved significantly. ACLS seems to be coming back the game. The stock is trading at less than it was when the company was posting significant quarterly losses and now has double the revenues it had just a year ago.

Get to know this small cap since I am in Boston and my close friend work there.

ACLS is a semi-conductor materials company here in the Boston area. It is a turn-around story since it has changed from a bad earning to good earnings.

However, this is a risky stock that is significantly more volatile than the overall market (beta = 2.9). It's been a rough year for the stock, losing 50% since the beginning of this year.

Now the stock is undervalued, this stock is a peripheral to ride the tech sector.

LONG ACLS

nalysts expect Axcelis to earn $0.11 per share in 2011 (15x P/E) and $0.24 in 2012 (7x). The company has $45 million of net cash and $210 million of tangible book value. CEO Mary Puma recently claimed that "Axcelis is off to a solid start in 2011," but Mr. Market apparently disagrees. In fact, some may question Ms. Puma's nearly decade-long stewardship of the company due to a long record of shareholder value destruction.