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Much like the Dow Jones Industrial Average, our Ziff Davis Channel Zone Stock Index continues to hover at an annual high. The index, designed to track 30 solutions providers and IT consulting firms, rose 1.57 percent for the week ended Dec. 12. Advancers beat decliners, 19-11, during the period. The index is up nearly 9 percent since its launch in October.

Last week’s major winners included Manchester Technologies Inc. (MANC, +13.23 percent), GTSI Corp. (CTSI, +12.91 percent), Acxiom Corp. (ACXM, +7.58 percent), MPS Group Inc. (MPS, +6.26) and Affiliated Computer Services Inc. (ACS, +5.74).

Only two index members, Unisys Corp. (UIS, -10.64 percent) and PC Connection Inc. (PCCC, -5.05 percent), slid more than 5 percent on the week.

Manchester provides timely hope to many midsize solutions providers. The Hewlett-Packard Co. partner last week announced reasonably strong results for its fiscal first quarter ended Oct. 31. Year-over-year revenue rose almost 10 percent to $74.7 million and year-over-year net income nearly doubled to $311,000. President and CEO Barry R. Steinberg says Manchester is witnessing an increase in IT spending, but cautions that “the increase hasn’t been continuous.”

Still, Manchester remains overly dependent on product sales (94.3 percent) rather than IT services (5.7 percent). As a result, pricing pressure and competition continue to impact the company’s gross margins, concedes Steinberg. Generally speaking, most successful IT solutions providers now generate more than half of their revenue from services.

GTSI, a government solutions provider, also delivered upbeat financial data. The Chantilly, Va.-based company says its year-over-year average daily sales increased in September, October and November. As any old-time journalist will tell you, three’s a trend.

What’s next? The answer is continued consolidation. MPS Group lined up a $150 million credit facility for possible acquisitions in the legal, health care, finance and accounting fields, according to president and CEO Timothy Payne.

Many deals are already in motion. Two examples: Convergys Corp. (CVG, +0.60 percent) is snapping up Alltel Communications Inc.’s wireless billing and customer care assets for $37 million. And Acxiom swallowed Claritas Europe, a marketing research firm, for $40 million. For more on the solution provider land grab in Europe, read my other weekly column, Contract Watch, on Dec. 16.

I hate to end the column on a dim note, but the mood was dark at Unisys last week. Shares in the company slid more than 10 percent after the solutions provider said employee pension costs will likely weigh on next year’s earnings.

But hey, that’s next year. Channel confidence remains strong this month. Enjoy the moment.

About this Column: The Ziff Davis Channel Zone stock index tracks 30 channel-related 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.

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. (

Company Symbol  Dec. 12  One Week Web
Accenture Ltd. ACN $25.01 -1.26%
Acxiom Corp. ACXM $17.89 7.58%
Affiliated Computer Services Inc. ACS $53.40 5.74%
Agilysys Inc. AGYS $11.40 2.61%
American Management Systems Inc. AMSY $15.07 -0.20%
Arrow Electronics Inc. ARW $23.48 1.29%
Avnet Inc. AVT $22.25 2.91%
CDW Corp. CDWC $57.80 -1.01%
Ciber Inc. CBR $9.06 0.33%
Cognizant Technology Solutions Corp. CTSH $45.73 -1.15%
Computer Sciences Corp. CSC $42.46 2.61%
Convergys Corp. CVG $15.20 0.60%
Covansys Corp. CVNS $9.76 -2.40%
DiamondCluster International Inc. DTPI $9.58 1.38%
Digitas Inc. DTAS $9.28 5.45%
Electronic Data Systems Corp. EDS $22.76 -1.90%
GTSI Corp. GTSI $13.47 12.91%
IBM Corp. IBM $92.71 2.28%
Ingram Micro Inc. IM $15.70 4.25%
Keane Inc. KEA $14.25 1.71%
Manchester Technologies Inc. MANC $3.68 13.23%
Manhattan Associates Inc. MANH $28.34 1.21%
MPS Group Inc. MPS $9.51 6.26%
PC Connection Inc. PCCC $8.64 -5.05%
Perot Systems Corp. PER $13.73 -0.15%
Pomeroy IT Solutions Inc. PMRY $14.75 3.00%
Sapient Corp. SAPE $5.06 -4.35%
Tech Data Corp. TECD $36.71 0.44%
The Titan Corp. TTN $21.69 1.02%
Unisys Corp. UIS $14.62 -10.64%
Current Index 1,085.94
Previous Week 1,069.18
Weekly Change 1.57%