Welcome to Week 13 of the Big Idea Portfolio. Riverbed Technology (NAS: RVBD) led the week's movers with a 2% rally, followed closely by Rackspace Hosting's (NYS: RAX) 1.9% gain. I'll have more on why in a minute. First, let's dig into the numbers.

Company

Starting Price*

Recent Price

Total Return

Apple $422.46 $599.55 41.9%
Google (NAS: GOOG) $650.09 $641.24 (1.4%)
Rackspace Hosting $41.65 $57.79 38.8%
Riverbed Technology $25.95 $28.08 8.2%
Salesforce.com $100.93 $154.51 53.1%
AVERAGE RETURN -- -- 28.12%
S&P 500 SPDR $127.15** $140.81 10.74%
DIFFERENCE -- -- 17.38

Source: Yahoo! Finance.
* Tracking began at market close on Jan. 6, 2012.
** Adjusted for dividends and other returns of capital.

Riverbed enjoyed its largest move on Thursday, following the news that analysts at Capstone Investments had initiated coverage of the stock with a "buy" rating.


By itself that wouldn't mean much. Capstone is near the bottom third of analysts rated in our Motley Fool CAPS database, after all. The difference here is that Capstone is the fourth consecutive firm to make a bullish call on the stock. The last, All-Star stock picker Northland Securities, initiated coverage with an "outperform" rating in January.

To be fair, shares of Riverbed have fallen 3.7% since. Yet I still see a buying opportunity here. Riverbed remains the dominant provider of deduplication technology for accelerating the delivery of data over wide area networks, and that's in spite of stiff competition from Cisco. The company has also partnered with Akamai Technologies (NAS: AKAM) to create whole products for improving information access and delivery from private networks to the public cloud.

Rackspace briefly touched an all-time high on Tuesday, when it reached $59.43 a share. The same day, analysts at Canaccord Genuity initiated coverage with a "hold" rating. Anyone else mystified by that? Why initiate coverage and then fail to take a stand on behalf of investors?

Perhaps it doesn't matter. Both retail and institutional investors appear to be betting on a nice rally. Researcher optionMONSTER says deep-pocketed speculators bought more than 6,000 June calls with a strike price of $65 per share. The implication? Big Money bettors believe Rackspace will exceed $65 a share before summer is half over. As a shareholder, I'm hoping they're right.

Finally, while shares of Google didn't move much during the week, DigiTimes on Wednesday reported that the company is working with Asia's ASUS to produce a 7-inch tablet priced at $199. The aim? Take share from both the Kindle Fire and the iPad.

The Wall Street Journal followed up on Friday with news that the Big G plans to market and sell tablets through an online store of its own. Who's right? Who cares? Android tablets haven't captivated consumers and business users in the same way that the iPad has. Google needs to change that.

The week that was
Once more, stocks rallied. The Dow closed up 1% while the S&P 500 added 0.81%, as both indexes closed with the best quarterly performance in 14 years, CNBC reports. The tech-heavy Nasdaq, which added 0.77% for the week, had its best quarter since 1991. Among the major indexes, only the small-cap Russell 2000 remained mute, adding just 0.03% for the week.

Meanwhile, the CBOE Volatility Index, or VIX, widely regarded as the best measure of fear in the market, added 4.6% for the week but remains down nearly 34% year to date. Investors appear unafraid to put new money to work. Are you among that group? Weigh in using the comments box below.

See you back here next weekend for more tech-stock talk. And remember to check out the Fool's latest special report, "3 Stocks That Will Help You Retire Rich," and add the Big Idea portfolio stocks to your Foolish Watchlist for ongoing, up-to-the-minute coverage. Both the report and the Watchlist are 100% free to use:

At the time this article was published Fool contributor Tim Beyers is a member of the Motley Fool Rule Breakers stock-picking team. He owned shares of Apple, Google, Rackspace Hosting, Riverbed Technology, and Salesforce.com at the time of publication. Check out Tim's Web home, portfolio holdings and Foolish writings, or connect with him on Google+ or Twitter, where he goes by @milehighfool. You can also get his insights delivered directly to your RSS reader.The Motley Fool owns shares of Apple, Cisco Systems, and Google. Motley Fool newsletter services have recommended buying shares of Google, salesforce.com, Rackspace Hosting, Apple, and Riverbed Technology, writing covered calls on Riverbed Technology, creating a bear put spread position in salesforce.com, and creating a bull call spread position in Apple. The Motley Fool has a disclosure policy. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.

Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.


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