Hardware Companies Highlight 3Q Stock Performances

The tech sector had a solid third quarter on Wall Street, but hardware companies were particularly strong, according to a sampling of the stock prices of 32 vendors by Channelweb.com. Nine of the top 10 performers were hardware-focused companies while six of the bottom seven sell mostly software. The average increase was about 20 percent, meaning they outperformed the growth of Dow Jones (15 percent) and Nasdaq (15.7 percent) during that period. Only four of the 32 companies saw their stock prices decrease as of Sept. 30, compared to June 30. Here's a closer look at the big (and not so big) gainers, ranked from worst to first.

June 30, 2009: $17.84
Sept. 30, 2009: $16.80
Change: -5.8%



Websense had an impressive first half of the year on Wall Street, when its stock increased 19.2 percent, but the third quarter was not as kind to the San Diego-based Web, data and e-mail security company.

June 30, 2009: $21.42
Sept. 30, 2009: $20.84
Change: -2.7%





Perhaps investors aren't loving the fact that the Sun Microsystems merger has been delayed by European regulators. Also, in its third-quarter earnings ended Aug. 31, Oracle said new software licenses were down 17 percent, an indication that customers have cut back on purchases.

June 30, 2009: $9.22
Sept. 30, 2009: $9.09
Change: -1.4%



Oracle isn't the only half of the merger struggling on Wall Street. Last month, CEO Larry Ellison said Sun was losing $100 million each month that the Oracle-Sun deal is delayed.



Sun's shares had jumped more than 140 percent through the first half of the year after it was revealed that IBM was interested in buying the company.

June 30, 2009: $4.53
Sept. 30, 2009: $4.51
Change: -0.4%



In August, Novell announced a third-fiscal-quarter profit of $16.7 million, which compared to a $15.1 million loss in the year-ago quarter. The vendor also launched a program to help ISVs develop Linux-based appliances, but the Waltham, Mass.-based company still saw its stock fall slightly over the three-month period ended Sept. 30.

June 30, 2009: $15.58
Sept. 30, 2009: $16.47
Change: 5.7%



During the third quarter, Symantec integrated its reputation-based security technology, Quorum, into its new Norton Internet Security 2010 and Norton AntiVirus 2010 products. Also, in order to boost more channel sales, Symantec created an extended financing program in concert with GE Capital that extends financing to 60 days on products purchased through distributors, but it wasn't enough to keep its stock price from climbing any higher than less than 6 percent.

June 30, 2009: $41.41
Sept. 30, 2009: $43.79
Change: 5.7%



McAfee garnered some third-quarter attention for naming Jessica Biel as the most dangerous celebrity on the Web (because Web searches for her could land you on a bad site), but Wall Street still wasn't too impressed with security companies in the third quarter.

June 30, 2009: $23.77
Sept. 30, 2009: $25.72
Change: 8.2%





Microsoft's shares increased slightly in the third quarter, but Wall Street might be waiting to see what happens when Windows 7 is released later this month before deciding on a longer-term view of the company's stock.

June 30, 2009: $13.39
Sept. 30, 2009: $14.60
Change: 9.0%



Panasonic opened its channel for authorization on its fully rugged and ultramobile notebooks in the third quarter, but the company's shares only increased by a dollar and change during the third quarter.

June 30, 2009: $4.73
Sept. 30, 2009: $5.23
Change: 10.6%



The Marlborough, Mass.-based company is transforming itself to have more of an enterprise focus and a security play, which continued in the third quarter with the integration of its H3C networking and TippingPoint security lines to create an integrated network security fabric. During the quarter, the company announced sales had fallen 15 percent during the second quarter, while earnings had fallen more than 90 percent.

June 30, 2009: $13.62
Sept. 30, 2009: $15.26
Change: 12.0%



Dell introduced a new line of SMB servers, as well as storage and UPS devices in the third quarter, but the company also agreed to pay $4 million to the New York Attorney General in a deceptive business practices lawsuit. The company got a big boost on Aug. 28 when its stock rose 7 percent after it reported better-than-expected earnings, evidence that corporate spending on technology products might be picking up.

June 30, 2009: $23.60
Sept. 30, 2009: $27.02
Change: 14.5%



Juniper's shares received a big boost Sept. 9 after the networking vendor said demand with service provider customers was good. Its stock jumped nearly $2 after CEO Kevin Johnson made the remarks at an analysts' conference.



Earlier in the quarter, Juniper struck an OEM deal with IBM to rebrand and sell Juniper's fledgling Ethernet switching line as part of IBM's overall data center networking vision.

June 30, 2009: $104.42
Sept. 30, 2009: $119.61
Change: 14.5%



IBM has been pushing hard into the public sector space, which seems to have pleased investors.



"We're in a position where what we're seeing is great demand for a type of vision as well as the solutions we've developed," said Gerry Mooney, general manager of IBM Global Fiscal Stimulus and Economic Recovery, in a recent interview with Channelweb.com.

June 30, 2009: $7.52
Sept. 30, 2009: $8.83
Change: 17.4%



Lenovo refreshed its ThinkPad portfolio in the third quarter, introducing the X200 tablet and the T400s laptop, the company's first to have multitouch screens. Lenovo may also have been helped by recently released iSuppli research that noted total global PC shipments in the second quarter increased 1.1 percent sequentially.

June 30, 2009: $16.55
Sept. 30, 2009: $19.57
Change: 18.2%



The company held its Intel Developer Forum during the third quarter, where CEO Paul Otellini said, "I think we will see PC unit shipments that are flat to slightly up over 2008. It shows that we have built something that is indispensable."



Intel also unveiled an "app store" for its Linux-based Moblin operating system and its first Core i7 chips for notebooks.

June 30, 2009: $15.25
Sept. 30, 2009: $18.05
Change: 18.4%



Compellent CEO Phil Soran joined other executives in expressing optimism for an economic recovery.



"Early signs of market stabilization favor Compellent as midsize enterprises continue to deploy our more efficient modular, scalable virtualized storage solution," Soran said.



During the third quarter, Compellent announced its sales for the previous quarter had increased 37 percent compared to last year.

June 30, 2009: $15.25
Sept. 30, 2009: $18.05
Change: 18.4%



Late in the third quarter, Xerox announced it was buying business process outsourcing solution provider Affiliated Computer Services for $6.4 billion, the largest acquisition the company has ever made.

June 30, 2009: $23.47
Sept. 30, 2009: $28.35
Change: 20.8%



In the third quarter, Check Point introduced new architecture called the Software Blades, which allows an organization to put together customized building blocks for their security, CEO Gil Schwed told Channelweb.com in August.



The company also unveiled ZoneAlarm Extreme Security 2010 during the quarter, which includes a hard drive encryption solution in a consumer security suite. ZoneAlarm Hard Drive Encryption automatically encrypts all hard drive content to protect personal and irreplaceable data in the event of laptop loss or theft.

June 30, 2009: $40.19
Sept. 30, 2009: $48.87
Change: 21.6%



SAP announced it planned to acquire SAF, a Swiss developer of applications used by retailers and manufacturers to manage inventory, for approximately $91 million, during the third quarter.



On the channel side, the company said it is taking steps to integrate its SAP Business All-in-One and Business Objects channel partner programs in a bid to get resellers to carry both product lines.

June 30, 2009: $38.65
Sept. 30, 2009: $47.21
Change: 22.1%



On Sept. 24, CEO Mark Hurd said he expects sales of IT products to rebound in the coming year and HP executives said that Hewlett-Packard is positioned to outpace the market and record overall sales growth between 3 and 4 percent in 2010.



"We think we have the best portfolio of technologies and services in the industry," said Hurd, speaking at a securities analyst meeting. "We're pretty well-positioned to go out in the marketplace and win. I think HP's best days are ahead of it, not behind it."

June 30, 2009: $17.43
Sept. 30, 2009: $21.99
Change: 26.2%



CA CEO John Swainson said in early September that he expects to retire by the end of the year.



Swainson is no lame duck, however. The Islandia, N.Y.-based company also acquired NetQoS, a privately held developer of network performance management and service delivery software, for $200 million in cash less than two weeks later. The acquisition will help CA expand its line of network and systems management tools for cloud computing.

June 30, 2009: $18.65
Sept. 30, 2009: $23.54
Change: 26.2%



Cisco Systems rolled out an array of products, services and financing options for solution providers serving small businesses. More than 3,500 partners have signed up for Cisco's Small Business Partner Development Fund tracks, each catering to different types of channel partners and rebate levels, from small-business-focused Cisco VARs to DMRs.



On the product side, Cisco unveiled the SA 500 Series, a $550 network security offering and new addition to Cisco's Small Business Pro Series featuring built-in firewall, VPN capabilities, optional VeriSign Identity Protection and optional e-mail and Web security through Trend Micro's ProtectLink Gateway.

June 30, 2009: $14.41
Sept. 30, 2009: $18.35
Change: 27.3%



Netgear impressed Wall Street in the quarter, perhaps in part because it expanded its ReadyNAS line with the Netgear Stora NAS appliance for home media. The Stora NAS appliance gives home users an easy-to-use interface to help them centralize the storage of their photos, music, video and other data, as well as share their home media.

June 30, 2009: $6.63
Sept. 30, 2009: $8.59
Change: 29.6%



Motorola joined the Android party in September, unveiling its first device, the Cliq, to feature Google's Android open-source mobile operating system. The company's stock rose 9 percent the day after the Cliq was announced.

June 30, 2009: $13.10
Sept. 30, 2009: $17.04
Change: 30.1%





EMC mourned the loss of its legendary co-founder, Richard "Dick" Egan in late August, but the company also made two acquisitions in the quarter, Kazeon, for its eDiscovery software, and FastScale Technology, a provider of software platforms for building, optimizing, managing and deploying application environments in physical, virtual and cloud infrastructures.

June 30, 2009: $142.43
Sept. 30, 2009: $185.35
Change: 30.1%



Apple is seemingly in the news every day with its iPhone or Apps Store, but in the third quarter it also made noise for a product that's not available or even announced yet.





The company is reportedly looking to market a tablet device with a 9.6-inch screen early in 2010. One Apple OEM supplier said it has been contracted to supply up to 300,000 battery packs for a tablet computer.

June 30, 2009: $15.85
Sept. 30, 2009: $21.54
Change: 35.9%



The printing solutions company saw its shares increase more than 35 percent in the third quarter, despite IDC numbers released last month that the global printer market fell sharply in the second quarter.



But the Lexington, Ky.-based company may have been helped with a couple of product refreshes announced during the quarter, some Web-connected printers for SMBs announced in July,



and some touch-screen, Web-connected all-in-one inkjet printers announced in early September.

June 30, 2009: $20.13
Sept. 30, 2009: $27.64
Change: 37.3%





Red Hat is the only true software developer in the top 10 vendor stocks surveyed here, due in part to it reporting a 12 percent revenue increase for the second quarter, with executives saying that its customer base is now into Linux for the long haul.

June 30, 2009: $26.50
Sept. 30, 2009: $36.53
Change: 37.8%



Western Digital's stock price increase is impressive, but even more so considering the company had already seen its stock increase more than 130 percent during the first six months of the year.

June 30, 2009: $10.46
Sept. 30, 2009: $5.21
Change: 45.4%



Like its hard-drive competitor Western Digital, Seagate also saw a 3Q surge in its stock price after a triple-digit increase through the first half of the year.



Year to date, Seagate's stock is up 243 percent, from a $4.43 closing price last Dec. 31.

June 30, 2009: $3.87
Sept. 30, 2009: $5.66
Change: 46.3%



AMD bolstered its portfolio in the third quarter with some 40-watt, six-core Opteron server processors and a $99 quad-core processor.

June 30, 2009: $0.83
Sept. 30, 2009: $1.26
Change: 51.8%



It's been a good year for storage manufacturers as Quantum joins Seagate and Western Digital in impressive stock gains. Shares of Quantum have increased 250 percent since the beginning of the year.

June 30, 2009: $5.48
Sept. 30, 2009: $8.40
Change: 53.3%



In the Sunnyvale, Calif.-based security vendor's most recent financials, sales fell 13 percent, but its net income almost quadrupled. The stock increased more than 14 percent the next day and has been steadily climbing ever since. The company's 53.3 percent stock increase in the third quarter was more than its stock increase through the first six months of the year (37.7 percent).