Talkin’ Cloud Stock Index: Is the Cloud Bubble Deflating?
It might be time to start worrying. After a small upturn toward the end of May, the Talkin’ Cloud Stock Index has shown its fourth loss in as many weeks. The 20 publicly traded SaaS and cloud providers that make up the Talkin’ Cloud Stock Index fell 1.94 percent for the week ending June 17, 2011. We’re still seeing a 5.70 percent rise from Jan. 1, 2011 – but on May 20, that figure was 16 percent. So we’re forced to ask: Is the cloud bubble slowly deflating?
Before we jump into our weekly look at the cloud winners and losers, here’s our standard warning: We don’t provide specific financial advice. Whether you buy, sell, or hold is up to you and you alone. We maintain the Talkin’ Cloud Stock Index to compare cloud hype against real-world financial performance.
- SaaS employee spend management solution developers Concur Technologies (CNQR) saw a 3.53 percent boost to $47.51 per share after SmarTrend identified it as a top performer in the “application software industry,” making the company the week’s big winner.
- Similarly, education SaaS vendor Blackboard (BBBB) rose 2.08 percent to $40.76 per share after that same report. Intriguingly, however, that growth was also aided by the rumor that Providence Equity is leading a bidding war to acquire Blackboard.
- Citrix Systems (CTXS) dropped a head-turning 7.26 percent down to $74.19 per share. Why? It’s hard to say exactly, but it seems that recent investments in cloud startup Cotendo, coupled with skepticism around recent the recent acquisition of VDI-in-a-box provider Kaviza, could be the culprit. That seems like a flimsy reason for so steep a drop, so Talkin’ Cloud is digging for more answers.
- Rackspace Hosting (RAX) experienced its own fall of 5.69 percent to $38.27 per share after analysts singled it out as having low upside potential.
- Google (GOOG) dipped to $485.02 per share — a week-to-week loss of 4.81 percent — on the news that Oracle is seeking billions of dollars from the search giant in a dispute over a smartphone patent. And clearly, investors are spooked.
- Cloud ERP provider NetSuite (N) is proving that the market moves in mysterious ways after a 4.09 percent drop to 34.24 per share for no readily apparent reason. Is this just another sign of overall deflation?
As you can see, there’s not very much good news to go around this week, with investors appearing to take most any excuse to sell off their shares in cloud companies. Come back the same time next week for another update and see if the trend turns itself around.