Tuesday, August 19, 2008

Data Center Stocks

While the Dow, S&P and NASDAQ were all down today, I believe the tech stocks are going to continue to be a bright spot in an otherwise bleak market. I found a new web site tonight that I really enjoyed playing around in and researching data center stocks and the industry as a whole. So as to help justify the hour plus that I spent on the site I thought I would share some of the information I discovered.

The site ( MFFAIS) lets you en ter a stock symbol and it then tells you information about financial institutional/fund ownership of the stock. The numbers that interested me were the number of funds that owned the particular stock and the percentages bought or sold over the given time period. For a small group of data center stocks that interested me here are the results.

Format: Stock --- Shares owned by funds --- % buying --- % selling

Equinix --- 399 --- 48.45% --- 45.37%
Level3 --- 347 --- 40.95% --- 37.41%
Digital Realty Trust --- 310 --- 55.28% --- 39.02%
Savvis --- 214 --- 46.91% --- 43.82%
DuPont Fabros --- 160 --- 51.47% --- 41.91%
Internap --- 108 --- 41.17% --- 45.13%
Terremark --- 90 --- 58.97% --- 26.92%
Switch&Data --- 8 --- 0 --- 0

I assume that anything within +- 5% probably isn't of too much concern given how much regular trading activity happens. I still believe though that this is further evidence that the data center stocks are doing good and are seen favorably by fund managers. For the sake of comparison take a look at Cisco and Intel. Besides Microsoft they were the only two other tech stocks on the MFFAIS "top 10 Most U.S. most held stocks" list. Cisco stock is held by 2,077 funds and Intel by 2,009 funds!

Some other interesting web surfing that came up while searching for financial information on the tech industry included:

  • Market Watch has an article about theJacob Internet fund manager seeing promise in tech companies.
Forbes has an excellent interview with Diane Bryant, CIO of Intel. I had planned on summarizing more of my favorite points from this interview - but my favorite was her thoughts on a cultural change happening within Intel (and certainly other companies) about everything changing to an IT service versus a "server".

"If you deploy virtualization, you get a cultural change. It's not your server anymore. It's a service provided by IT to your department with a certain service level agreement. Then you can aggregate multiple apps onto that server and your utilization goes up. But you have to get over that cultural element, which is, "Where's my server?"

Finally -- does anyone know of an online tool (preferably free) that will let you build your own stock index? I would love to build my own index of favorite stocks and track it on a regular basis. Please leave a comment if you know of something. Thanks!

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