Most of the major public companies in the data center industry outperformed the Dow Jones Industrial Average and other market indices in the first half of 2007, with several of last year’s high fliers trailing the market. The sector’s leading players are unlikely to match their stellar performance in 2006, but many continue to beat the broader market, boosted by the strong demand for premium data center space. Here’s our mid-year roundup of the leading data center stocks and their performance in the first half of 2007:
Six of the nine stocks outperformed the Dow, which gained 7.6 percent in the first six months of the year, as well as the S&P (up 6 percent) and NASDAQ Composite Index (up 7.8 percent).
The strongest performer has been Savvis Communications (SVVS), which gained 38.6 percent as investors responded to the company’s data center expansion program and utility computing model. Next-best was Equinix (EQIX), another data center service provider in expansion mode, which ended the first half with a flourish with Friday’s announcement that it will acquire IXEurope for $482 million. Shares of EQIX rose 21 percent in the first half.
Infocrossing (IFOX), Switch & Data (SDXC), Digital Realty Trust (DLR) and Navisite (NAVI) had more modest gains of between 9 and 13 percent.
Trailing the broader averages were three providers that gave back some of their big gains in 2006. These included Terremark (TMRK), Akamai (AKAM) and Internap (INAP). Akamai gained 166 percent in 2006, but is off 8.4 percent in the first half, while Internap, which rose 362 percent last year, is down 27 percent thus far in 2007. Terremark improved by 44 percent in 2006, but slipped by 4 percent in the first half of the year.