Except in one sector (Telecomms – see later) March was relatively unspectacular. But what a Q1 we have seen! NASDAQ up 8%, FTSE100 up nearly 9%, the FTSE SCS Index up 10.5%, TechMark100 up 13% and the FTSE Hardware Index up an amazing 10%.
The Telecoms Index is easy to explain as its two largest constituents - BT and Vodafone– both recorded 21% gains. In the Hardware Index, its largest constituent – ARM– put on a sparkling 20% rise in Q1 with others like Imagination doing even better.
In Software and IT services, Computacenter put on 11% in March alone; that’s a 28% gain YTD. I apparently upset a number of readers (all of whom work for Computacenter…) with my widely reproduced Goodbye Logica post. They felt I had unfairly excluded Computacenter from my Top Ten SCS providers to the UK market. I have huge respect for what Mike Norris has done with Computacenter in moving them away from ‘box shifting’ towards IT services and am quite happy to celebrate Computacenter as one of our largest and leading IT companies HQed in the UK. But it doesn’t even get into the Top 20 of SCS providers. If we included hardware, or indeed revenues from a wide range of other ‘non-SCS’ sources, our rankings would look very different.
A wide range of other, smaller players recorded double-digit growth in March 13. Amongst them are Enables IT (up 146%), Interquest (up 28% - more of a ‘rebound’ after missing expectations yet again), Emblaze (Up 26%) and Tribal (up 25% on an upbeat trading statement) Our friends at Parity put on 10% in March making that a massive 39% gain YTD (and the #1 slot in the Holway Portfolio YTD). See Parity returns to a business of two halves.
Amongst the international players, HP put on 18% - although this is still just a recovery rather than a return to anything like previous glories for the beleaguered group. All eyes on the findings of the inquiry into the Autonomy affairs after which we predict a riot. See Autonomy case moves up a gear.
At the other end of the scale, SDL got the wooden spoon this month with a 24% decline as they announced further significant S&M and R&D investment. See SDL fights back with additional investment.Quindell, which I am sure wins all prizes for most PR activity, saw its shares decline 11% in March. See Quindell buts medico-legal SaaS provider and work back. A seasonal slowdown hit Anite shares - down 21% in March.
Steria saw its shares slip16% this month. See Steria: finance sector drags UK numbers down. Despite Customer acquisition strategy working for Sopheon, their shares tumbled by 16% this month.
Quarter ends usually mean soul searching. Are we going to see a ‘correction’ or is this the start of a solid and long-lasting bull run? The weekend papers have articles supporting both views! I always get worried when hords of retail investors pile into equities as their record is one of ‘sell low, buy high’. That said, the alternative investments are pretty unappealing too. Still, mustn’t complain, I guess I could have had all my money in a Cypriot bank