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July 10, 2013

First Half of 2013 Shows Significant Movement in Cloud Stock

By Steve Anderson, Contributing TMCnet Writer

With the first half of 2013 now one for the history books, and more than a few people likely wondering where the time went, already some points have started to become clear. One of the biggest, at least in the field of cloud computing, is that some companies are clearly doing very—very well indeed—when it comes to cloud computing, as expressed by stock price, while some companies on that measure have some catching up to do.



So far, 2013—as measured from January 2 to July 5—has been met with both some impressive gains in the stock front for cloud computing, as well as some distressing losses. The Cloud Computing Stock Index, which contains 20 companies total, has brought forth some very interesting numbers on this front, with 10 of the 20 companies bringing returns to shareholders, while the other half of the exchange saw capital losses.


Image via Shutterstock

Perhaps the most noteworthy part about the results from the first half of the year with the Cloud Computing Stock Index is that neither the gains nor the losses were exactly small. No company that gained saw less than double-digit gains, and no company that lost ground saw a loss under 10 percent of total share value. For instance, in the gainers, the lowest gain seen on the index was Amazon at 11.10-percent gain on the year, while the highest gain was brought in by NetSuite, with a 37.30-percent gain. Meanwhile, as for the decliners, the lowest losses were seen at Red Hat, Inc., which lost 11.47 percent of value, while Rackspace Hosting (News - Alert), Inc. had the worst losses at 46.78 percent.

It's worth noting that each of the companies in the Cloud Computing Stock Index generates at least half of its revenues from cloud-based applications, as well as cloud-based services and/or accompanying infrastructure. This means that certain portions of the index will likely have an advantage over certain other portions due to the particular field in which those companies operate. For instance, Amazon has a lot more going on than just cloud, being a major retailer as well. The big gain here, NetSuite (News - Alert), offers up its massive gains, some propose, thanks to a growing acceptance of cloud-based enterprise resource planning (ERP) systems, as well as NetSuite's intent to move into the manufacturing sector and recent plans to ally with Oracle (News - Alert). But Amazon was also seeing success with Amazon Web Services and the Kindle line of products—indeed, to many, the Kindle Fire tablet is one of if not outright the best in inexpensive tablets—giving it some stock boost as well.

There are a lot of factors going into the gains and declines found on the Cloud Computing Stock Index so far, and a lot of time to go before the end of the year. There's every opportunity for both gainers and decliners to gain and decline alike—both reversing trends or building on the current—but it's going to take a lot of work in this highly competitive field to yield the results that the businesses and the stockholders of same want to see. Where will the Index end up when the year is out? Only time will tell, but it will certainly be worth watching.




Edited by Alisen Downey
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