Cloud Stocks Fall Nearly 10 Percent Amid Wall Street Sell-Off

August 8, 2011

2 Min Read
Cloud Stocks Fall Nearly 10 Percent Amid Wall Street Sell-Off

By samdizzy

wall street

Like the broader financial markets, cloud computing stocks went into a free fall on Monday, August 8. Our Talkin’ Cloud Stock Index fell 9.10% during today’s U.S. trading session, and the index is now down 9.47% so far in 2011. The index had been up nearly 20% in Q1, 2011. All of those gains have been wiped out in recent days.

The biggest drop of 2011 came today. Shares in Concur Technologies (CNQR), Constant Contact (CTCT), Kenexa Corp. (KNXA), NetSuite (N), Rackspace Hosting (RAX), Rightnow Technologies (RNOW) and SuccessFactors (SFSF) all fell between 10 percent to 13 percent today. Here’s a look at all 20 of our Talkin’ Cloud Stock Index members, along with their daily and year-to-date performance.

Company Symbol Aug. 8 1 Day YTD%
Amazon AMZN $193.70 -4.44% 7.61%
Athenahealth Inc. ATHN $48.69 -9.31% 18.81%
Blackboard Inc. BBBB $40.69 -4.71% -1.48%
Citrix Systems Inc. CTXS $58.18 -9.67% -14.95%
Concur Technologies Inc. CNQR $35.93 -10.58% -30.81%
Constant Contact Inc. CTCT $15.10 -10.28% -51.27%
CoreSite Realty Corp. COR $13.88 -9.64% 2.59%
Equinix Inc. EQIX $83.75 -9.12% 3.06%
Google Inc. GOOG $546.02 -5.70% -8.07%
Intuit Inc. INTU $40.94 -6.10% -16.96%
Kenexa Corp. KNXA $20.83 -12.37% -4.41%
NetSuite Inc. N $30.25 -11.91% 21.00%
Rackspace Hosting Inc. RAX $31.49 -12.38% 0.25%
Red Hat Inc. RHT $34.96 -7.39% -23.42%
Rightnow Technologies Inc. RNOW $25.71 -12.46% 8.62% CRM $124.93 -7.93% -5.36%
SuccessFactors Inc. SFSF $22.11 -13.26% -23.65%
Taleo Corp. TLEO $24.69 -8.32% -10.71%
VMware Inc. VMW $83.96 -3.80% -5.57%
Vocus Inc. VOCS $22.89 -9.60% -17.25%

The Bigger Story

Broader markets also fell sharply on August 8. According to the Associated Press:

“The Dow Jones industrials fell 634.76 points. It was the sixth worst point decline for the Dow in the last 112 years and the worst one-day drop since December 2008. Every stock in the Standard & Poor’s 500 index declined Monday.”

The drop occurred after Standard & Poor’s downgraded U.S. debt.

The Cloud Remains Profitable

So, is the glass half full or half empty for cloud computing stocks? On the one hand, most of our Talkin’ Cloud Stock Index members have profitable, fast-growing cloud computing businesses — solid business fundamentals for the long-haul. But on the other hand, some cloud computing companies and cloud service providers continue to have lofty valuations.

Generally speaking, we update the Talkin’ Cloud Stock Index after U.S. markets close each Friday. But we’ll be watching cloud computing stocks extra closely this week amid continued volatility on Wall Street.

Disclosure: I owned shares in Rackspace and Red Hat.

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