The Year’s Top Stocks
Warning: It’s a depressing list.
Photographs by Tim Boyle/Getty Images.
What better way to while away the waning days of 2011 than to look back at the investment opportunities you missed? Even in a generally flat year for the big S&P 500 index, a handful of firms did much better than average. A look at the standout business success stories behind the 10 stocks with the highest percentage price increase on the index helps us understand how the American economy has evolved. (We’ll look exclusively at firms that started and ended the year as S&P components.)
1. Cabot Oil & Gas
Opening price: $38.46. Current price: $76.41.
Growth: 107 percent
Success for the energy industry will be a theme of this list, and, as you can tell from the name, the good people of Cabot are involved in the oil and gas industry. Specifically onshore drilling right here in the United States of America. With facilities in Texas, Louisiana, Pennsylvania, and the Rocky Mountains, they’ve ridden the hydrofracking boom to more than double the value of their stock.
2. El Paso Corporation
Opening price: $13.75. Current price: $26.20.
Growth: 90.41 percent
Currently based in Houston rather than its original hometown, the El Paso Corporation is primarily in the business of owning and operating regulated interstate natural gas pipelines, another industry getting a boost from frack-mania. On Oct. 16 they announced they would be acquired by Kinder Morgan, driving stock prices even higher.
Opening price: $220.85. Current price: $372.59.
Growth: 66.25 percent
As of June 27, a share of MasterCard would run you $272.60, a figure that rose to $278.28 the following day and then skyrocketed to $309.70 by the 29th. Why? Well, back in 2010 the U.S. Congress saw fit, as part of the Dodd-Frank financial regulatory overhaul, to cap the “swipe fees” that Visa and MasterCard charge retailers to process debit card transactions. On June 29, 2011, the Federal Reserve issued the actual rule, which turned out to be considerably kinder to the card companies than most observers had anticipated.
Opening price: $55.10. Current price: $88.35.
Growth: 61.4 percent
The nation’s largest operator of private Medicare-funded insurance plans got some bad news in 2010 when the Obama health reform law seriously curtailed the subsidies available to private providers. But the 2010 midterms were a godsend to the company, as the new House budget chief has spent the past year diligently pushing his plan to expand private plans’ eligibility to serve as Medicare middlemen, and a surge of GOP governors and state legislators advocated for the increased privatization of Medicaid services.
Opening price: $56.43. Current price: $85.95.
Growth: 55 percent
ONEOK describes itself as “a leader in the gathering, processing, storage and transportation of natural gas in the U.S.,” with a specific focus in Kansas, Oklahoma, and the rapidly growing Texas market, and in 2011 natural gas meant money.
6. Ross Stores
Opening price: $31.94. Current price: $48.54.
Growth: 54 percent
America’s a rich country, so people don’t starve in bad economic times. Instead, they downsize their shopping habits. Discount retailer Ross’promise to let you “dress for less” proved appealing to a country that needed to clothe itself (and an industry that needed to turn over its excess apparel stock) amid generally falling wealth and incomes.
7. VF Corporation
Opening price: $86.36. Current price: $130.11.
Growth: 50.9 percent
Not exactly a household name, the VF Corporation is better known to most Americans as the owner of Lee & Wrangler jeans, the JanSport, Eastpak, and North Face lines of outdoor wear, and other apparel brands. Compared with most of the other companies on the list, VF’s strong performance in 2011 looks like an old-fashioned business success story—it paid a premium to acquire Timberland for $2.2 billion over the summer and is being rewarded by an investment community that has confidence in its ability to integrate the new brands into its powerful, existing global distribution platform.
Opening price: $30.42. Current price: $43.69.
Growth: 45.79 percent
Minnesota’s Fastenal sells fasteners, pneumatic devices, metal, tools, and other construction supplies to clients of all sizes. Its strong 2011 experience reflects, in part, its toehold in the booming China construction market. But it’s also cause for optimism that U.S. construction is recovering from its doldrums.
Opening price: $43.81. Current price: $65.02.
Growth: 46.43 percent
Like Ross, the worse America does, the better TJX does. The owner of discount clothing retailers Marshall’s and T.J. Maxx (known by the more badass name T.K. Maxx in Europe), TJX is cleaning up as Americans shift downscale.
Opening price: $70.38. Current price: $100.81.
Growth: 43.19 percent
A stock that sold for $75 on July 28 is suddenly worth more than $86 the next day. What happened? Did they invent some magical new form of credit card? Of course not. Instead, Visa joined its comrade MasterCard in popping the champagne over the Federal Reserve’s surprisingly light regulatory touch.
For a chronicle of successes, there’s something mighty depressing about this list. The way to get ahead over the past year has been to take advantage of the clothing-buying public’s misery, to score a regulatory policy coup, or to extract and burn finite fossil fuel resources without being made to properly pay for the negative externalities you generate. Here’s hoping for a better year to come.