IT Industry Execs Confident About Q3 2017, Study Finds

By: Jacqueline Lee| - Leave a comment


A new survey from CompTIA shows that most tech executives feel confident about hitting their revenue target in the third quarter of 2017. Their confidence is notable, as the IT Industry Business Confidence Index usually drops between Q2 and Q3. This year, it’s up 3.2 points to 67.4.

The report shows executives are more confident about the IT industry as a whole, with 70.6 percent now expressing confidence, as opposed to 66.7 percent in the second quarter. Executives were also more optimistic about in the potential within their own offices — confidence in their own companies was at 69.1 percent, up from 65.9 percent in Q2.

2017: So Far, So Good

As of August 18, Fidelity Investments shows securities in the information technology sector in 2017 are up 25.48 percent year-over-year, driven by healthy growth in multiple market segments. Tech hardware, storage and peripherals sales are up 41.8 percent over last year’s levels. Consumer software is also going strong, at 27.09 percent growth, with internet software and services up 22.51 percent and IT services up 17.44 percent.

Some analysts fear the rally is reminiscent of the 1990s dot-com bubble, especially since technology stocks are outperforming other market sectors. According to CNBC, however, others say that tech stocks are performing better than they have in the past five years, suggesting it’s not a long-term overinflation of stock values. The big returns are giving technology companies cash in the bank at just the right time: New technologies like artificial intelligence and autonomous vehicles are poised to take off, and tech companies have money to invest in them.

Although startups may have opportunities to be disruptive, the sheer quantity of resources available for large firms positions them to take advantage of emerging technologies and invest in them at scale.

“Big tech’s strong stock performance this year (and the last few years) is not a sign that the stock market is about to collapse,” writes CNBC’s Eric Jackson. “It’s simply a sign of how big and important these companies are becoming right in front of our eyes.”

Slower Growth, Better Valuation

CNBC also predicts the tech stock rally may slow over the coming months, perhaps even falling below the growth levels of other sectors. Even so, the technology sector’s price-to-earnings ratio is still red-hot.

“We could see these stocks make about a 9 percent dip from here and still be well within the past six months’ range [of valuations],” says Erin Gibbs, portfolio manager at S&P Global, according to the news source.

Slower growth at great valuations could also make it a great time to beef up tech stock purchasing, particularly for investors with longer growth horizons.

“If your time frame is very long and you’re young and you don’t think your portfolio has enough tech in it, use some of this fallback to start nibbling at some of those better names,” Bill Baruch, iiTrader senior market strategist, told CNBC.

CompTIA compiled its current IT Industry Business Confidence Index based on responses from 314 technology company executives.

Topics: , ,


About The Author

Jacqueline Lee

Freelance Writer

Jacqueline Lee specializes in business and technology writing, drawing on over 10 years of experience in business, management and entrepreneurship. Currently, she blogs for HireVue and IBM, and her work on behalf of client brands has appeared in Huffington Post, Forbes, Entrepreneur and Inc. Magazine. In addition to writing, Jackie works as a social media manager and freelance editor. She's a member of the American Copy Editors Society and is completing a certificate in editing from the Poynter Institute.

Articles by Jacqueline Lee
See All Posts