Press Room.
Technology stocks remain resilient despite turbulent times
The second quarter of 2010 saw the valuation of mid-market
technology companies fall by only 4% amid political uncertainty and
public sector cuts. This compares to a greater decline on the FTSE
100 and FTSE 350 which saw valuations drop by 13% according to the
latest Technology Index* from financial and business advisers Grant
Thornton.
The Technology Index tracks the performance of 142 UK listed
technology-related companies, excluding those on the FTSE 100 and
Micro Cap companies.
Wendy Hart, Technology Partner at Grant Thornton says, "Despite
a slight drop in valuations in Q2 2010, technology stocks are
holding up well and we are seeing a greater appetite for mergers
and acquisitions. We are particularly seeing the resurgence of
investment from the US, where investors are willing to put their
heads above the parapet again. There may be good opportunities for
US investment in the UK, given the strength of the dollar against
the pound."
The eight FTSE 100 listed technology companies also saw their
values decline in Q2 2010; the greatest falls in valuations were
-29% for Invensys, -8% for Vodafone Group and -6% for Cable and
Wireless. Arm Holdings was the only FTSE 100 technology business to
significantly buck the trend, seeing share value increase by 16%.
The semiconductor company supplies chipsets for the iPhone and was
boosted by strong sales for the newly launched iPhone 4.
Semiconductors was also the sub-sector faring the best in this
quarter's Technology Index, seeing valuations rise by 11% in Q2
2010.
Hart concludes, "Semiconductor businesses are benefiting from
the move from conventional infrastructure to wireless and
intellectual property (IP) technology and this is only set to
increase as consumers and businesses require greater flexibility
from technology. Innovision Research and Technology is the
Technology Index's semiconductor winner this quarter with its share
price more than doubling (117%). Innovision's share price has been
boosted this quarter by a takeover offer from US company
Broadcom."
For further information, please contact: Lisa Ritchie, Grant
Thornton Press Office: on 020 7728 2208 or