The Japanese stock market ruled 2013, but some American companies did very well themselves in areas ranging from fundamental innovation to multilevel marketing. These are your top five best-performing stocks of 2013:
- Tesla: Despite a substantial autumn slump, this is still up 346 percent on the year with investors very excited about a company that can make a fully electric car that critics all say is just a really great car. It's obviously a much too expensive car for the vast majority of people to consider buying, but the strategy of working with a really fantastic car and then improving the cost structure does seem more promising than starting with a fatally compromised vehicle and hoping people buy it out of eco-guilt.
- Netflix: These guys are up 296 percent on the year on the strength of an apparently successful pivot into original content production. This was clearly the right strategy for the company, but there was no particular reason to think they could actually pull it off. But their shows are good!
- Best Buy: Up 239 percent and I say ugh to that.
- Twitter: Up 145 percent on the year in what I would call a case of IPO mispricing. Facebook shares slumped a lot after its initial public offering, which Wall Streeters deemed a "failure" but is also known as "getting a good price for your stock." Twitter came out of the gate determined to avoid the "mistakes" of the Facebook IPO and that included selling shares at a relatively modest price and then watching them pop.
- Herbalife: This stock is up 138 percent thanks to a fairly hilarious hedge fund battle. Last December, Bill Ackman took a large short position in the company and alleged it's operating an illegal pyramid scheme. That drove the price way down. But Herbalife ended up with some prominent backers including Carl Icahn, and this year the price went way back up.
All in all, I see this as a fairly optimistic view of the American economy. Unlike in some past years it's not all discount stores and fossil fuel extractors. Tesla, Netflix, and Twitter are all bringing genuinely new products to the marketplace and even Best Buy (ugh) is in some sense up because it's improved its business not just stumbled into some good fortune. Herbalife's wild ups and downs are primarily a reminder that on some level financial capitalism is a huge joke, but otherwise thumbs up.