martinwolf publishes three proprietary indices (U.S., China and India Editions) that are used by IT sector businesses, international media, and the professionals at the firm to analyze the state of the industry. The MW IT Index remains the only index of its kind in the IT Services industry.
All editions are tracked on a five-year historical basis beginning with a value of 1000.
MW IT Index® Global Edition
The MW IT Index® (Global Edition) is a report of our proprietary analysis using securities that are weighted according to the market value of their outstanding shares through the fourth quarter of 2012. The global edition of our Index combines our U.S., India and China editions, tracking companies and comparing them to public stock exchanges in each of these geographies.
The maturity of the IT Services market continues to preclude any major collective shifts in the Index, though we are seeing a general optimism as enterprise spending returns. We expect continued performance as the recovery continues, with IT spending expected to increase 4.6% from 2013.
The most volatile performers in our Index continue to be the SaaS and Supply Chain sectors, which remain, respectively, the highest and lowest valued sectors that we track. The SaaS industry in particular is seeing higher valuation multiples than ever before, while many of the Supply Chain companies faced further difficulties this quarter as holiday revenues came in significantly below expectations.
On a global scale, we anticipate continued convergence in the Indian IT services field, especially among Tier 2 players looking to better compete with the higher-valued Tier 1 companies. Additionally, the Chinese IT industry, which already this quarter has seen milestones in M&A activity with Lenovo's acquisitions of Motorola Mobility and IBM's x86 server division and Chinasoft's investment in SaaS provider Deem, Inc., will continue to accelerate in both size and market presence in the year to come.
View the entire Index here.
The MW IT Index® (India Edition) is an analysis using securities that are weighted according to the market value of their outstanding shares. This Index includes 36 Indian IT Services and Business Process Outsourcing (BPO) companies traded in the U.S. (NYSE and NASDAQ) and Indian (BSE) stock markets.
The MW IT Index (China Edition) is an analysis using securities that are weighted according to the market value of their outstanding shares. This Index includes 28 Chinese IT Services and Business Processing Outsourcing (BPO) companies traded in the U.S. (NYSE, NASDAQ, and OTC), London (LSE AIM), Chinese (SZSE, SHSE, SEHK) or Taiwanese (TSEC) stock markets that are a composite representative sampling of enterprise values.
The MW IT Index (U.S. Edition) is an analysis using securities that are weighted according to the market value of their outstanding shares. The Index includes 166 IT companies traded on the U.S. stock markets that are a composite representative sampling of enterprise values in IT Services & BPO, IT Supply Chian Services, and Software and SaaS. Consequently, Cognizant, which is an Indian outsourcing company trading in the U.S., is included, but Rolta, which does not trade in the U.S., is not included.
Description and Formula
The MW IT Index® is a market-value-weighted index. The representation of each security in the index is proportional to its last sales price times the total number of shares outstanding, relative to the total market value of the respective index.
Adjustments for securities being added to or deleted from the index, or capitalization changes, are made periodically. Stock splits and stock dividends are likewise adjusted for during the process. In the case of cash dividends, no adjustment is made.