Talkin' Cloud Stocks Index Corrects Course with 1.5% Dip

Talkin' Cloud Stocks Index Corrects Course with 1.5% Dip

Not every week can bring a 10 percent jump to the Talkin' Cloud Stocks Index. That's why I'm not surprised -- but a little disappointed -- that the 20 cloud and SaaS stocks that make up the index experienced a slight 1.77 percent drop for the week ending Oct. 21, 2011. It's a course correction after last week's solid gains. As you may expect though, even the biggest weekly losers experienced only minor drops, and the Talkin' Cloud Stocks index is still up 6.79 percent for the year to date.

But before we take our closer look, here's our usual litany of responsibility: the Talkin' Cloud Stocks Index only exists to match cloud hype against Wall Street performance. We don't make specific financial recommendations, and whether you buy, sell or hold is up to you and you alone.

Three Winners

  • CoreSite Realty Group (COR) gained 3.34 percent to $15.14 per share after analysts realized just how low its EV/EBITDA is -- a key ratio when determining the future value of a stock.

  • In second place was enterprise ERP provider NetSuite (N), which had a good week with a 3.09 percent gain to $35.02 per share. A new release of the company's flagship NetSuite OneWorld product propelled its price higher, but key company executives including CEO Zachary Nelson and CTO Evan Goldberg selling a combined 8,000 shares depressed the stock before the closing bell on Friday.

  • Finally, we have VMware (VMW), which experienced a 2.94 percent boost to its stock price -- to the tune of $95.82/share -- after issuing a solid, if unexceptional, third-quarter earnings statement that got some analysts worried about the virtualization and cloud infrastructure provider's long-term plans.

Two Losers

  • By far, the biggest loser was cloud storage specialist Carbonite (CARB), which dipped a full 11.05 percent to $12.50 per share. Oddly enough, no reason was immediately apparent.

  • The other loser of the week was SuccessFactors (SFSF), which dropped 8.43 percent to $24.01 per share after analysts singled it out as a stock with high volatility.

Like I said before: This drop is disappointing but not unexpected. And we're still in the positives for the year to date, with only two months to go. Make sure to come back this time next week for more updates on the Talkin' Cloud Stocks Index.
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