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Microsoft and Red Hat Generated Most Returns in Systems Software

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YTD returns of 20.5% for Microsoft in 2015

The systems software subsector in the First Trust ISE Cloud Computing ETF (SKYY) has generated YTD (year-to-date) returns of -5.2% compared to 11.9% in 2014. Microsoft (MSFT) generated maximum YTD returns of 20.5%. It also rose 27.5% in 2014. The YTD returns of Red Hat (RHT) and Checkpoint (CHKP) are 19.1% and 5%, respectively, compared to returns of 23.4% and 21.8%, respectively, in 2014. VMware (VMW), NetSuite, Oracle (ORCL), and CA Inc. have generated YTD returns of -31%, -22.6%, -18.2%, and -5%, respectively. This subsector constitutes 18.2% of SKYY.

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Moving averages

VMware is currently trading at $57.0, or 18.6% below its 100-day moving average of $7.0, 4.2% below its 50-day moving average of $59.5, and 2.8% below its 20-day moving average of $58.6.

NetSuite is currently trading at $84.5, or 3.4% below its 100-day moving average of $87.5, 0.6% below its 50-day moving average of $85.0, and 1.5% above its 20-day moving average of $83.3.

CA Inc. is currently trading at $28.9, or 3.5% above its 100-day moving average of $28.0, 3.6% above its 50-day moving average of $27.9, and 2.4% above its 20-day moving average of $28.3.

Oracle is currently trading at $36.8, or 3.1% below its 100-day moving average of $38.0, 4.2% below its 50-day moving average of $38.4, and 2.8% below its 20-day moving average of $37.9.

Checkpoint is currently trading at $82.5, or 1.2% above its 100-day moving average of $81.6, 1.3% below its 50-day moving average of $83.6, and 2.5% below its 20-day moving average of $84.7.

Red Hat is currently trading at $82.3, or 7.2% above its 100-day moving average of $76.8, 2.8% above its 50-day moving average of $80.1, and 2.4% above its 20-day moving average of $80.4.

Microsoft is currently trading at $56.0, or 13.5% above its 100-day moving average of $49.3, 4.1% above its 50-day moving average of $53.7, and 1.3% above its 20-day moving average of $55.2.

Analyst recommendations

VMware is trading at a discount of 22% to the 12-month median analyst estimates, whereas, NetSuite, CA Inc., Oracle, Checkpoint, Red Hat, and Microsoft are trading at discounts of 15%, 2%, 16%, 13%, 11%, and 4%, respectively, to median analyst estimates.

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