Index Performance in 3Q2011
It was a difficult quarter for most of the U.S. stock market and the Space Foundation Indexes were no exception. The third quarter of 2011 saw an abrupt end to the growth that characterized the first half of the year. The Space Foundation Index declined in the third quarter by slightly more than 20 percent, erasing earlier gains and putting the index into negative territory for the year. Both the S&P 500 and NASDAQ Composite indexes also declined significantly over this period, as can be seen in Exhibit 1.
The Space Foundation Services Index remains the most sensitive to market trends and experienced the worst losses in the quarter. The Space Foundation Infrastructure Index outperformed its counterpart during the overall downward trend.
Key movers in the third quarter of 2011:
- Garmin (3.8 percent decline) and Comtech Telecommunications (9.7 percent decline) retained the most value among companies in the Space Foundation Index during this downturn.
- Every other stock in the Space Foundation Indexes experienced double-digit percentage declines during the third quarter.
- Globalstar lost two-thirds of its value during the third quarter as it felt the market downturn more sharply than its peers. Globalstar's shares have fallen so far that is now in danger of being delisted from the NASDAQ stock exchange.
- In July 2011, Integral Systems was acquired by Kratos Defense & Security Solutions. As a result of the merger, Integral Systems shares are no longer publicly listed and the company has been removed from the Space Foundation Index.
- Continuing the trend of acquisition in the space industry, Honeywell acquired another ground infrastructure provider, EMS Technologies, in August for $497 million. As a result of this acquisition, EMS Technologies is no longer a component of the Space Foundation Indexes.
- As a result of the three acquisitions of index components in the past two quarters, the Space Foundation Index now has 28 component stocks.