Software as a Service Stocks Finally Rally
Investors are worried about executive changes at Salesforce.com, but that didn’t stop a strong rally this week in software as a service (SaaS) stocks. Thanks to strong earnings from RightNow Technologies (RNOW) and several other companies, our SaaS 20 Stock Index jumped more than 7 percent for the week ended February 6. Here’s a look at the weekly SaaS winners and losers.
SaaS 20 Stock Index: Weekly Winners
- RightNow Technologies (RNOW, +50% this week): The SaaS CRM provider disclosed annual revenues of $140 million, up 25% growth over 2007 and recurring revenue was $102 million or 20% growth over 2007. Investors certainly seemed impressed. After dumping RightNow shares in late January, bullish buyers returned and gave RightNow’s stock a 50 percent lift this week.
- Omniture (OMTR, +20.90% this week): The interactive marketing software provider didn’t meet Wall Street’s profit expectations for Q4,but the company’s Q1 outlook still impressed investors.
- Blackboard Inc. (BBBB, +13.89% this week): The company, which develops SaaS distance learning software for schools, met Wall Street’s Q4 earnings expectations and the stock jumped on the news.
SaaS 20 Stock Index: Weekly Losers
- For the first time in multiple months, the SaaS 20 Stock Index had no major weekly losers. Concur Technology (CNQR, -3.73%) recorded the biggest one-week drop. The company, which specializes in on-demand corporate travel and expense management software, said fiscal Q1 earnings jumped 72 percent. However, investors got nervous when the company declined to discuss its Q2 earnings outlook.
Meanwhile, there’s growing speculation about multiple resignations at Salesforce.com. Skim this story from MarketWatch, and you’ll notice the exodus apparently involves more than Salesforce.com’s president.
Despite questions surrounding Salesforce.com, the strong week erased nearly all of the SaaS 20 Stock Index‘s losses from January 2009. For the year, the SaaS 20 Stock Index is essentially flat.