|By PR Newswire||
|April 4, 2014 09:30 AM EDT||
CHICAGO, April 4, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the IBM Corp. (NYSE:IBM-Free Report), Cisco Systems, Inc. (Nasdaq:CSCO-Free Report), NetSuite Inc. (NYSE:N-Free Report), Rackspace Hosting, Inc. (NYSE:RAX-Free Report) and Veeva Systems Inc. (NYSE:VEEV-Free Report).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Thursday's Analyst Blog:
Dark Clouds Hover Over These Cloud Stocks
According to a study, cloud-related tech spending is expected to witness an almost three-fold jump from $78.2 billion in 2011 to $235.1 billion in 2017. Multibillion-dollar investments in cloud-based architectures are expected to follow as more and more companies turn to cloud computing to offer online storage, computing, analytics and provisioning services to tackle a proliferation of huge data.
But before joining the bandwagon, companies must realize that technology is just a mere tool and not necessarily the only route to success. It is true that cloud computing can play wonders in transforming a business by offering a competitive edge, but a company requires more than just tools and technologies to succeed in the long run.
As each player in the industry strives to win a greater market share with reduced barriers-to-entry and competitive pricing, the battle gets increasingly murkier. With the global consumer cloud subscription tally projected to rise to 730 million this year from 630 million in 2013, the fight for dominance is understandably fierce. However, not all companies have been able to cash-in on the euphoria and have visibly lagged far behind in the race. Before we zero-in on such stocks that investors should avoid currently, let us have a quick look across the cloud to gauge the movements of the movers and shakers.
As commoditization of cloud services gains steam, service providers are reducing prices to gain more market share. This has led to intense price wars among rivals as one tries to outwit the other.
However, not all companies are aggressively following the pack. Price is one of three factors in the decision-making process for availing cloud computing services, the other two being quality and innovation. Experts argue that in order to maintain margins, tech companies will try to offset the price cuts with over-subscription of their services. This is expected to culminate in performance degradation, thereby eroding the financial benefits and leaving the customer at status quo.
Cloud services provider IBM Corp. (NYSE:IBM-Free Report) has resisted itself from across-the-board price cuts and instead introduced special pricing deals for volume customers. Cisco Systems, Inc. (Nasdaq:CSCO-Free Report) further pushed the envelope when it announced an ambitious plan to invest over $1 billion to build the world's largest global Intercloud (a network of clouds) over the next two years. The Cisco global Intercloud is expected to raise the performance bar with an expanded suite of value-added application- and network-centric cloud services to accelerate the Internet of Everything.
3 Cloud Stocks to Avoid
Not all companies are able to capitalize on such positive vibes in the industry. Let's take a closer look at these companies that appear to be falling much behind in the race and are expected to perform abysmally in the short-term.
NetSuite Inc. (NYSE:N-Free Report): Headquartered in San Mateo, CA, NetSuite offers cloud-based financials and enterprise resource planning (ERP) and omni-channel commerce software suites in the U.S. and internationally. This Zacks Rank #3 (Hold) stock has a poor year-to-date return of -8.1% (as of April 2, 2014).
The current Zacks Consensus Estimate for the recently concluded quarter is pegged at a loss of 24 cents, which represents a year-over-year decrease of 43.5%. The earnings estimate for full-year 2014 has also declined by 6 cents or 7.3% in the last 90 days to a loss of 88 cents.
Rackspace Hosting, Inc. (NYSE:RAX-Free Report): Headquartered in San Antonio, TX, Rackspace provides cloud computing services for small and medium-sized businesses through dedicated hardware and multi-tenant pools of virtualized hardware. With a year-to-date return of -15.7%, this Zacks Rank #3 (Hold) stock has witnessed a steady drop in earnings estimates.
The current Zacks Consensus Estimate for the recently completed quarter is pegged at 12 cents, which represents a year-over-year decrease of 39.0%. The earnings estimate for full year 2014 has declined by 12 cents or 16.7% in the last couple of months to 60 cents.
Veeva Systems Inc. (NYSE:VEEV-Free Report): Headquartered in Pleasanton, CA, Veeva provides industry-specific cloud-based software solutions for the life sciences industry in North America, Europe, the Asia Pacific, and Latin America. This Zacks Rank #4 (Sell) stock has a dismal year-to-date return of -18.4%.
Earnings estimate for both the recently completed quarter and the ongoing fiscal have been revised downward. The earnings estimate for fiscal 2015 has declined by 4 cents or 16.7% in the last month to 20 cents.
With such disappointing metrics and grim earnings outlook, investors may be better off if they avoid these stocks.
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today.
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros.
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
SOURCE Zacks Investment Research, Inc.
24Notion is full-service global creative digital marketing, technology and lifestyle agency that combines strategic ideas with customized tactical execution. With a broad understand of the art of traditional marketing, new media, communications and social influence, 24Notion uniquely understands how to connect your brand strategy with the right consumer. 24Notion ranked #12 on Corporate Social Responsibility - Book of List.
Sep. 30, 2016 07:37 AM EDT
Adobe is changing the world though digital experiences. Adobe helps customers develop and deliver high-impact experiences that differentiate brands, build loyalty, and drive revenue across every screen, including smartphones, computers, tablets and TVs. Adobe content solutions are used daily by millions of companies worldwide-from publishers and broadcasters, to enterprises, marketing agencies and household-name brands. Building on its established design leadership, Adobe enables customers not o...
Sep. 30, 2016 07:30 AM EDT
Everyone knows that truly innovative companies learn as they go along, pushing boundaries in response to market changes and demands. What's more of a mystery is how to balance innovation on a fresh platform built from scratch with the legacy tech stack, product suite and customers that continue to serve as the business' foundation. In his General Session at 19th Cloud Expo, Michael Chambliss, Head of Engineering at ReadyTalk, will discuss why and how ReadyTalk diverted from healthy revenue an...
Sep. 30, 2016 07:15 AM EDT Reads: 2,240
Cognitive Computing is becoming the foundation for a new generation of solutions that have the potential to transform business. Unlike traditional approaches to building solutions, a cognitive computing approach allows the data to help determine the way applications are designed. This contrasts with conventional software development that begins with defining logic based on the current way a business operates. In her session at 18th Cloud Expo, Judith S. Hurwitz, President and CEO of Hurwitz & ...
Sep. 30, 2016 07:15 AM EDT Reads: 3,267
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform and how we integrate our thinking to solve complicated problems. In his session at 19th Cloud Expo, Craig Sproule, CEO of Metavine, will demonstrate how to move beyond today's coding paradigm ...
Sep. 30, 2016 07:00 AM EDT Reads: 3,465
Digitization is driving a fundamental change in society that is transforming the way businesses work with their customers, their supply chains and their people. Digital transformation leverages DevOps best practices, such as Agile Parallel Development, Continuous Delivery and Agile Operations to capitalize on opportunities and create competitive differentiation in the application economy. However, information security has been notably absent from the DevOps movement. Speed doesn’t have to negat...
Sep. 30, 2016 07:00 AM EDT Reads: 2,336
Leading cloud-centric IT organizations are establishing core capabilities to improve productivity, control costs and provide a highly responsive end-user experience. Key steps along this journey include creating an end-user cloud services catalog, automating workflows and provisioning, and implementing IT showback and chargeback. In his session at 19th Cloud Expo, Mark Jamensky, executive vice president of Products at Embotics, will walk attendees through an in-depth case study of enterprise I...
Sep. 30, 2016 07:00 AM EDT Reads: 1,507
Without a clear strategy for cost control and an architecture designed with cloud services in mind, costs and operational performance can quickly get out of control. To avoid multiple architectural redesigns requires extensive thought and planning. Boundary (now part of BMC) launched a new public-facing multi-tenant high resolution monitoring service on Amazon AWS two years ago, facing challenges and learning best practices in the early days of the new service. In his session at 19th Cloud Exp...
Sep. 30, 2016 06:15 AM EDT Reads: 1,129
The Transparent Cloud-computing Consortium (abbreviation: T-Cloud Consortium) will conduct research activities into changes in the computing model as a result of collaboration between "device" and "cloud" and the creation of new value and markets through organic data processing High speed and high quality networks, and dramatic improvements in computer processing capabilities, have greatly changed the nature of applications and made the storing and processing of data on the network commonplace.
Sep. 30, 2016 06:00 AM EDT Reads: 1,261
Your business relies on your applications and your employees to stay in business. Whether you develop apps or manage business critical apps that help fuel your business, what happens when users experience sluggish performance? You and all technical teams across the organization – application, network, operations, among others, as well as, those outside the organization, like ISPs and third-party providers – are called in to solve the problem.
Sep. 30, 2016 06:00 AM EDT Reads: 2,736
Digital transformation is too big and important for our future success to not understand the rules that apply to it. The first three rules for winning in this age of hyper-digital transformation are: Advantages in speed, analytics and operational tempos must be captured by implementing an optimized information logistics system (OILS) Real-time operational tempos (IT, people and business processes) must be achieved Businesses that can "analyze data and act and with speed" will dominate those t...
Sep. 30, 2016 05:30 AM EDT Reads: 1,284
While DevOps promises a better and tighter integration among an organization’s development and operation teams and transforms an application life cycle into a continual deployment, Chef and Azure together provides a speedy, cost-effective and highly scalable vehicle for realizing the business values of this transformation. In his session at @DevOpsSummit at 19th Cloud Expo, Yung Chou, a Technology Evangelist at Microsoft, will present a unique opportunity to witness how Chef and Azure work tog...
Sep. 30, 2016 05:15 AM EDT Reads: 1,847
Almost two-thirds of companies either have or soon will have IoT as the backbone of their business in 2016. However, IoT is far more complex than most firms expected. How can you not get trapped in the pitfalls? In his session at @ThingsExpo, Tony Shan, a renowned visionary and thought leader, will introduce a holistic method of IoTification, which is the process of IoTifying the existing technology and business models to adopt and leverage IoT. He will drill down to the components in this fra...
Sep. 30, 2016 05:00 AM EDT Reads: 1,885
As ridesharing competitors and enhanced services increase, notable changes are occurring in the transportation model. Despite the cost-effective means and flexibility of ridesharing, both drivers and users will need to be aware of the connected environment and how it will impact the ridesharing experience. In his session at @ThingsExpo, Timothy Evavold, Executive Director Automotive at Covisint, will discuss key challenges and solutions to powering a ride sharing and/or multimodal model in the a...
Sep. 30, 2016 04:45 AM EDT Reads: 674
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 19th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo Silicon Valley Call for Papers is now open.
Sep. 30, 2016 04:45 AM EDT Reads: 4,721