Buying into big data

  @FortuneMagazine January 16, 2014: 6:58 AM ET
CEN03 big data investing
(Fortune)

Do you know Splunk? It's a company -- in the scaldingly hot realm of big data -- whose name is derived from "spelunk," which the company uses as a metaphor for locating something in a giant, dark cave. Splunk helps clients track usage to shore up weaknesses in electronic systems, while also extracting meaning from massive repositories of digital information. Its revenues have jumped 10- fold in four years, though the company has yet to record profits. Even as the Nasdaq surged 33% over the past year, Splunk's stock has jumped 150%.

"Big data" is a bit like "the cloud" a few years ago: Simply having the moniker attached to a company means that not only is it in a growth area, but it's also likely blessed with a stock market premium. For investors that means risk -- in the form of high prices and nascent companies with uncertain futures -- but also opportunity. Consolidation is afoot, and tech behemoths are snapping up big-data outfits. Smart investors can benefit.

Join the Conversation
Markets
Sponsored by
Index Last Change % Change
Dow 16,393.13 -31.72 -0.19%
Nasdaq 4,081.54 -4.69 -0.11%
S&P 500 1,859.38 -2.93 -0.16%
Treasuries 2.66 0.02 0.76%
Data as of 10:17am ET
Company Price Change % Change
Bank of America Corp... 16.04 -0.09 -0.57%
General Electric Co 26.60 0.48 1.84%
Facebook Inc 59.60 -0.12 -0.20%
Huntington Bancshare... 9.13 -0.18 -1.93%
Micron Technology In... 23.47 0.99 4.40%
Data as of 10:02am ET
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.41%4.44%
15 yr fixed3.33%3.31%
5/1 ARM3.34%3.55%
30 yr refi4.39%4.41%
15 yr refi3.31%3.30%
View rates in your area
 
Find personalized rates:
Rate data provided
by Bankrate.com
Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.