What is Cloud Computing?

Cloud computing (CC) is the technique of processing, storing, and managing data on a network of remote computers hosted on the internet rather than on a personal computer or local server. A pure-play cloud computing company concentrates all its efforts on a single line of business, and, as such, tech giants like Google, Microsoft, and Amazon are not pure-play given their diversified business focuses. 

What Is CC's Market Size & Projected Growth?

 According to a Markets and Markets report, the cloud computing market will expand at a 17% CAGR between 2022 and 2027 which is an astronomical growth rate which should bode well for CC companies.

Which Are the Largest Pure-Play CC Companies?

Below is a list of the largest pure-play CC companies presented in descending order of their performances in December (MTD) and for 2023 (YTD)

The Pure-Play Cloud Computing Companies Index

1. Arista Networks (ANET): up 7.2% MTD; up 93.2% YTD
   • Business Model: develops, markets, and sells cloud networking solutions that consist of a set of network applications, as well as gigabit Ethernet switching and routing platforms.
2. Pure Storage (PSTG): up 7.1% MTD; up 31.9% YTD
   • Business Model: provides data services, such as data reduction, data protection, and encryption, as well as storage protocols, including block, file, and object. 
3. Drop Box (DBX): up 4.6% MTD; up 32.0% YTD
   • Business Model: provides a platform that allows individuals and groups to collaborate and sign up for free through its website or app, or upgrade to a paid subscription plan for premium features.
4. DataDog (DDOG): up 4.1% MTD; up 64.2% YTD
   • Business Model: operates an observability and security platform for cloud applications.
5. Equinix (EQIX): down 1.2% MTD; up 21.0% YTD
   • Business Model: provides businesses with access to important locations, partners, and opportunities to expand their digital services, enhance customer experiences, and increase their overall value.
6. Box (BOX): down 2.1% MTD; down 18.4% YTD
   • Business Model: provides a platform that enables users to collaborate on content internally and with external parties, automate content-driven business processes, develop custom applications, and implement data protection, security, and compliance features.
7. Verisign (VRSN): down 2.9% MTD; up 0.3% YTD
   • Business Model: provides domain name registry services and internet infrastructure that enables internet navigation of .com and .net domains that support global e-commerce and also provides back-end systems for .cc, .gov, .edu, and .name domain names, as well as operates distributed servers, networking, security, and data integrity services.
8. Digital Reality Trust (DLR): down 3.0% MTD; up 32.9% YTD
   • Business Model: a REIT that provides data center, colocation, and interconnection solutions.

Summary

The above 8 CC stocks were up 0.2% in December and were up 28.9%, on average, in 2023.

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