Brutal January for Data Center Stocks

January was a grim month for the stock market, but a brutal one for the data center sector. Only two of the 13 stocks managed to finish in the black and improve on the performance of the Dow Jones Industrial Average, which fell 4.6 percent on the month. Ten of the stocks had double-digit losses, with five of them dropping at least a quarter of their value in January. Here’s the overview:

The early days of 2008 marked a reversal of fortune for many data center companies. The leading performers for January were Internap Network Services (INAP) and Limelight Networks (LLNW), which each ended 2007 with declines of 50 percent or more for the year. Internap gained 5.9 percent in January, while Limelight rose 1.7 percent.

The biggest losses in January were seen at the companies that had flown the highest, especially Bladelogic (BLOG) and VMware (VMW), which both went public in 2007 and were the year’s strongest performers.

Digital Realty Trust (DLR), which announced leases for three entire buildings in 2008, managed to buck a strong downward trend in the REIT sector, slipping by 9.2 percent. The other data center REIT, DuPont Fabros Technology (DFT), was down by 12.1 percent.

Data center builders Equinix (EQIX), Savvis Communications (SVVS) and Switch and Data (SDXC) were all down between 25 and 31 percent.

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About the Author

Rich Miller is the founder and editor at large of Data Center Knowledge, and has been reporting on the data center sector since 2000. He has tracked the growing impact of high-density computing on the power and cooling of data centers, and the resulting push for improved energy efficiency in these facilities.