Byte and Switch Index Rising

Looking for a little holiday cheer? Check out the Byte and Switch Index. Our collection of storage networking stocks to watch continues a general trend upward, demonstrating the overall growth of the market in 2003. So far, signs are good for momentum to continue modestly into the new year.

As shown in the graphic here, nearly all companies in the Index saw their share price rise at least 20 percent between January 2, 2003, the first day of trading for public companies this year, and today -- notwithstanding a downward dip last month.

The following companies can even boast triple-digit share price growth:

Improvement in share price doesn't necessarily mean these stocks are selling at high prices: MTI Technology, for instance, was trading at $2.38 this morning. But at this time last year, it was a penny stock, trading for $0.44. Likewise, Crossroads Systems was trading at $2.80 early today, but it was at $0.93 on January 2, 2003.

There's also no correlation between stock price growth and better financials. MTI, for instance, continued to report losses in its latest quarterly report (see MTI Posts Q2 Results). The point to note is the sense among investors that the storage market in general is on the upswing.Indeed, a handful of storage plays -- Network Appliance Inc. (Nasdaq: NTAP) and QLogic Corp. (Nasdaq: QLGC) -- have gotten into the Wall Street limelight, with plenty of activity surrounding the stock. NetApp execs have sold nearly $12 million in shares since the start of December, for example, signaling that the price is right to sell and that investors are willing to buy.

The growth of storage stocks should come as no surprise to anyone who's been watching this market. Storage networking has been targeted by nearly all major networking companies as one of the keys to future sales. Cisco Systems Inc. (Nasdaq: CSCO) recently labeled storage one of six billion-dollar-plus target markets (see Storage: A Cisco Billion Dollar Play).

So far, signs are good that growth in storage stocks will continue for the near term. EMC, NetApp, and QLogic, for instance, all predict earnings growth this quarter (see QLogic Continues to Click, EMC Cowboys Up in Q3, and NetApp Keeps Pedal to Metal).

Mary Jander, Site Editor, Byte and Switch