IT Software & Services: Q1 2013 review, prospects for the rest of 2013, and Top Picks CapGemini and Altran

News published on April Tuesday 9, 2013
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In Q1 2013 the performance of the Software & IT Services sector was flattish (+5.3% for the DJ EuroSTOXX Software & IT Services index, or a similar performance to that of the DJ EuroSTOXX 600 index, which was +5%), with new economic concerns raised by the US budget sequester, the Cypriot crisis, and the difficulties in forming a new government in Italy after the general election.

During the period, the clear best large-cap performers was Temenos (+41%, strong Q4 12 results), followed by Sage (+17%) and Capgemini (+8%). At the small-cap level, the outperformers were Alten and Sopra (+18% each). The worst performers were Steria (-26%, on pension provisions and speculation on net debt), Indra (-7%, disappointing FY13 margin guidance), Altran (-6%, risk of share overhang on potential OCEANE bond conversion), and Software AG (-6%, investments to hit margins in 2013-14).

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