Stock Watch: Week Ended Nov. 7, 2003, Channel Stocks Inch Higher

By Joseph C. Panettieri  |  Posted 2003-11-10 Email Print this article Print
 
 
 
 
 
 
 

Index rises 2.86% for the week ending Nov. 7. Winners beat decliners by 2-to-1. Avnet was up. Manchester Technologies was down. But our stock index shows vital signs are improving in the channel.

The patient isn't cured, but vital signs are improving.

That's the general feeling among investors who track publicly held solutions providers and distributors. Indeed, our Ziff Davis Channel Zone Stock Index rose a respectable 2.86 percent for the week ended Nov. 7, closing at 1061.71. The index is up more than 6 percent since mid-October.

Last week's big winners included Avnet Inc. (AVT, +12.27 percent), Pomeroy IT Solutions Inc. (PMRY, +10.36 percent), Perot Systems Corp. (PER, +10.26 percent), and Manhattan Associates (MANH, +10.06 percent). The only major decliner was Manchester Technologies Inc. (MANC, -10.63 percent).

Avnet shares have rallied strongly since the company announced 11 percent year-over-year quarterly revenue growth on Oct. 30. The Phoenix, Ariz.-based distributor also earned applause from Institutional Shareholder Services (IIS), which praised Avnet's corporate governance practices. On the technology front, Avnet last week announced a line of white box PCs equipped with AMD Inc.'s Athlon 64 processor, as well as a sales alliance with Rittal Corp., which specializes in electronic enclosure systems. Not exactly earth-shattering news but investors like Avnet's momentum.

Pomeroy shares also continued to rally on improved quarterly profits, which the company announced more than two weeks ago. Rival solutions providers should keep a close eye on Pomeroy's new partnership with Altiris Inc., which makes systems management software for servers, desktops and handhelds. If you're not familiar with Altiris, look them up—fast. The company has strong relationships with Dell Inc. and Hewlett-Packard Co. In fact, Altiris, HP and Intel Corp. recently organized a road show aimed at sparking corporate migrations to Windows XP.

Meanwhile, Perot Systems announced that year-over-year 3Q profits slid 16 percent. Ouch. Bad news, right? Wrong. Barrington Research upgraded Perot shares from market perform to outperform (memo to Barrington: Can't you just say "hold" to "buy"?), based on the company's year-over-year 3Q revenue growth of 8 percent. President and CEO Ross Perot, Jr., said he was "pleased" with the company's results and progress. And he pointed to a 10-year, $275 million outsourcing deal with Vanguard Car Rental USA Inc. as proof of Perot's momentum. The deal includes app development, maintenance, and data center services.

One week after announcing soft 3Q results, Manhattan Associates' stock rebounded strongly without any major news from the company. Perhaps rising tides do lift all ships.

The index's only major decliner was Manchester Technologies. Shares in the Hauppauge, N.Y.-based solutions provider have been on a roller coaster ride since a weak earnings announcement on Oct. 27. In the earnings release, President and CEO Barry Steinberg delivered upbeat statements about Manchester's balance sheet and services revenue. Shares did manage an 8.5 percent rally on Friday, Nov. 7, but that wasn't enough to offset daily losses from earlier in the week.

The Ziff Davis Channel Zone Stock Index tracks 30 solutions provider stocks on a weekly basis. We don't recommend buys, sells or holds. Rather, the index seeks to measure the channel's financial health. We launched the index on October 24 with a value of 1000. Each stock in the index is equally weighted. For example, if one stock rises 5 percent and another falls 4 percent, the net result is a 1 percent gain.

Company

Symbol

Nov. 7

One Week

Accenture Ltd.

ACN

25.05

7.05%

Acxiom Corp.

ACXM

16.2

1.89%

Affiliated Computer Services Inc.

ACS

49.41

0.98%

Agilysys Inc.

AGYS

10.84

5.45%

Anerican Management Systems Inc.

AMSY

15.54

5.64%

Arrow Electronics Inc.

ARW

23.42

9.70%

Avnet Inc.

AVT

21.78

12.27%

CDW Corp.

CDWC

59.5

-0.92%

Ciber Inc.

CBR

9.4

1.95%

Cognizant Tech Solutions Corp.

CTSH

47.15

3.88%

Computer Sciences Corp.

CSC

40.69

2.70%

Convergys Corp.

CVG

15.96

-0.62%

Covansys Corp.

CVNS

9.85

4.01%

DiamondCluster International Inc.

DTPI

8.61

-3.26%

Digitas Inc.

DTAS

8.52

-2.07%

Electronic Data Systems Corp.

EDS

21.69

1.12%

GTSI Corp.

GTSI

11.11

0.00%

IBM Corp.

IBM

88.26

-1.36%

Ingram Micro Inc.

IM

14.96

1.08%

Keane Inc.

KEA

13.6

3.50%

Manchester Technologies Inc.

MANC

3.11

-10.63%

Manhattan Associates Inc.

MANH

30.63

10.06%

Modis  Group Inc.

MPS

9.44

-1.15%

PC Connections

PCCC

9.75

-4.79%

Perot Systems Corp.

PER

11.71

10.26%

Pomeroy IT Solutions Inc.

PMRY

15.87

10.36%

Sapient Corp.

SAPE

5.82

8.18%

Tech Data Corp.

TECD

33.82

2.73%

The Titan Corp.

TTN

21.2

0.38%

Unisys Corp.

UIS

16.2

5.47%

 

 

 

 

 

Current Index

1061.71255

 

 

Previous Week

1032.23405

 

 

Weekly Change

2.86%

 

 

Joseph C. Panettieri has covered Silicon Valley since 1992. He is editorial director of the New York Institute of Technology and founder of JCP Media Inc..

 
 
 
 
 
 
 
 
 
























 
 
 
 
 
 

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