Opinions are complex things indeed. They’re formed by a confluence of forces like winds forming banks in the snow.
Oftentimes we’re not even aware of which winds have shaped our opinion. We might feel the strongest winds in our face, but the breezes pushing at our backs may go unnoticed. It is their combination that forms our opinion.
These winds can come from the media, our peers, our life experience, our fears, or our desires.
They shape our opinions, and our opinions impel decisions.
It works the same way for institutional decision-making, but on a much bigger scale. Governments, organizations, and corporations have to make decisions every single day, and they are based upon similar winds.
Despite what you might think, opinions CAN be wrong. In the business world, they’re the ones that hurt the company. That’s why impartial data analysis has become such an integral part of corporate decision-making.
With billions of historical data at their disposal, computers can help determine the most prudent course of action. These data, be they traffic accident statistics, transactional information, or even restaurant reviews, are the core resource. They are the raw material.
Big data company IHS (NYSE: IHS) has completed yet another acquisition that grants it more of this valuable raw material.
The Grab
In early April, IHS announced it would be acquiring a company called RootMetrics. The seven-year-old company observes mobile network connections and monitors quality of service over a whole range of conditions.
The company began as a service to consumers, allowing the average mobile network subscriber to see in detail how a commercial network performed. Users could submit their own quality-of-service (QoS) reports to RootMetrics, and the company assembled maps of where mobile carriers performed the best.
While this information is extremely valuable to the customer, it’s equally valuable to network technicians because it provides a ready visualization of service issues for both data and voice communications services. The company also formulates a “score” for networks, providing yet another digested look at overall quality of service.
IHS says RootMetrics will strengthen its telecommunications portfolio, which includes the company Infonetics Research that it acquired in December 2014.
That acquisition — and this overall move — marked a new direction for IHS. For the last five years, the blue chip has been on a tech data-buying spree. In 2010, it bought tech supply chain company iSuppli; in 2012, it acquired IMS Research and flat-panel display research company Displaybank.
President and CEO of IHS, Scott Key, said the information and communications technology space, including cyber security, transport networking, broadband, mobile, cloud, and Internet of Things, represents a “high strategic value” for IHS. The company’s analytics are among the top-five most quoted in the industry.
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Stock Reaction
IHS provides an exciting opportunity for investors who like to trade on formations.
Since 2008, IHS has been doing a reverse dead cat. The impressive upward rise is punctuated with regular dips that provide an excellent buying opportunity. Since the end of 2014, it’s been falling into one of those dips.
However, since the first weeks of 2015, the stock has been moving in a pennant formation. This very flat sideways movement was punctuated by a break in the upper trendline, a retreat, and then a full breakout.
The importance of this announcement has obviously already affected the stock, because it’s already moving sideways again.
In the long run, network intelligence is only going to become more valuable, so IHS’ growth into the telecommunications sphere will be dictated by its ability to turn these new funnels of data into something fresh.
Good Investing,
Tim Conneally
For the last seven years, Tim Conneally has covered the world of mobile and wireless technology, enterprise software, network hardware, and next generation consumer technology. Tim has previously written for long-running software news outlet Betanews and for financial media powerhouse Forbes.
