NW200: Net.Business, 04/24/00

We team with The Motley Fool to deliver network company stock updates, provide community discussions.

BY BETH SCHULTZ
Network World, 4/24/00

The Network World 200 is a great tool for assessing the financial well-being of top vendors in this business. Not only does it lay out which network vendors have the highest revenue, but also which ones are the most profitable, fastest growing, biggest R&D spenders, highest valued, and which have the highest revenue per employee. Still, the NW200 omits one critical measure: stock performance.

Quotes updated every 10 minutes. Base=200.

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For more on the top 200 companies in networking, click here.

The NW200 tells us that IBM rules the network roost, taking the No. 1 spot in our ranking once again. It doesn't tell us that Big Blue's share price has been holding relatively steady for years, but swung in the last 12 months from a low of $90.25 on Nov. 25, 1999, to a high of $246 on May 5, 1999, with a 2:1 split May 27. Or that NW200 newcomer Foundry Networks, No. 141, has been in big play on NASDAQ. In these early months of 2000, we've seen Foundry's share price reach as high as $345, on Jan. 3, and dip as low as $123.50, on Feb. 23, after splitting 2:1 on Jan. 10.

So Network World has teamed with online investment education firm The Motley Fool to launch an NW200-based stock index. We've taken our list of the top 200 companies in networking, assigned each a weight based on its 1999 revenue and created a tool you can use to track stock performance. Using the Network World 200 Index, you can track performance of network companies individually or as a group. Because of the weighting, larger revenue companies will affect the index more than smaller ones.

A simple index view shows share price, updated every 15 to 20 minutes, plus dollar and percentage changes, high and low prices and volume. A detailed view provides additional trending information, and, with The Motley Fool's help, you'll be able to figure out when fluctuations are serious and when they aren't.

Consider, if you would, the NW200 Index as the network equivalent of the Standard & Poor's 500 - the leading stock index of companies across 24 distinct industries, from aerospace and defense to utilities. NW200 companies represent just one-tenth of the S&P 500 makeup, and are lumped not together but in three distinct industry segments. Smaller, but hotshot NW200 companies like Covad Communications, Exodus Communications, Extreme Networks and Foundry aren't represented on the S&P 500.

With the NW200 Index, you get a full dose of stock information on network companies specifically. Immediately, you'll get a snapshot of how the network industry is faring on the wild exchange rides. Over time, the NW200 Index will provide a historical view, helping you judge individual companies and the health of the industry. This in turn will become a tool for comparing our industry with other vertical market segments.

But the straight numbers are only part of the picture. We'll link you to information Network World has gathered and stories we've published on NW200 companies, and we'll give you a chance to ask your own questions through The Motley Fool's online investor community. The Motley Fool is setting up a message board expressly for this purpose, and Network World editors will actively participate. "An index like the NW200 should provide seed material for community-based discussion and knowledge exchange," says Kevin Book, director of Web development for The Motley Fool site, www.fool.com.

Foundering stock prices could indicate a company is going to face some serious financial problems. But maybe the tumble is an anomaly, and other signs indicate the stock will shoot back up. Before you sign that network contract, you might want to solicit the opinion of seasoned investors.

"Hopefully, the NW200 will bring a few new tech-savvy Fools to the fold for the mutual gain of all within our community," Book says.

Of course, Network World readers won't be limited to participating in the NW200 Index message board. The Motley Fool would love to serve as a general information source and knowledge base for any investment questions you might have. More than two million users visit www.fool.com monthly, and hundreds, if not thousands, post tech-related stock messages daily, Book says.

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