The U.S. stock market returned almost nothing to investors in 2011. As of early December, the Standard & Poor’s 500 index had netted 0.9 percent — and actually lost 1 percent if dividends aren’t included.
Such poor overall performance hides some wide variations: 80 stocks in the S&P 500 returned 20 percent or more in 2011, while 43 lost more than a third of their value.
Bloomberg rankings analyzed S&P 500 returns as of Dec. 2 to determine which stocks were best and worst to shareholders in 2011. Their results follow, starting with 2011′s 5 best performers.
THE BEST STOCKS OF 2011
Industry: Oil exploration & production
Total return: 128.8 percent
On Oct. 27, Cabot (COG) reported that gas and oil production was up 39 percent from a year ago. The company also estimated production could expand 45 percent to 55 percent in 2012, a projection Global Hunter Securities analyst Dan Morrison called “eye-popping.”
Total return: 84.2 percent
El Paso (EP) shares rose in January when the company forecast “double digit” earnings growth in 2012. Then, on Oct. 17, shares surged higher still on news that competitor Kinder Morgan (KMI) would buy El Paso for $21.1 billion, 37 percent more than its closing price on Oct. 14.
Total return: 68.9 percent
The world’s largest maker of medicines treating multiple sclerosis, Biogen Idec (BIIB) saw its biggest share gains of the year — including a 15 percent rise on Apr. 21 — driven by studies showing the effectiveness of the experimental MS pill BG-12. Analysts estimated the product could bring in annual sales of as much as $3 billion.
Industry: Commercial services-finance
Total return: 69.2 percent
MasterCard (MA) is the world’s second-largest payment network, processing $2.1 trillion in credit- and debit-card purchases in 2010. In 2011, the company’s rising profit and market share boosted the stock. On Nov. 2, the company reported that net income rose 38 percent amid a 21 percent rise in credit-card spending.
Industry: Medical instruments
Total return: 68.3 percent
Intuitive Surgical (ISRG) said in October it expects sales to rise as much as 23 percent this year. The company’s main product, the robotic “da Vinci” surgical system, converts doctor’s hand motions into tiny movements inside a patient.
THE WORST STOCKS OF 2011
When world financial markets ran into trouble in August — problems sparked by concerns about European debt and Standard & Poor’s downgrade of U.S. government debt — the stocks of many financial services companies took it on the chin. From Aug. 1 to Oct. 3, the financial stocks in the S&P 500 dropped 23.5 percent. Other parts of the market, including the airline industry and materials companies, saw poor results for other reasons.
The following are the S&P 500′s 5 worst stocks of 2011, as measured by their total year-to-date return, including dividends, as of Dec. 2.
Industry: Human resources
Total return: -68.9 percent
Monster Worldwide (MWW) shares rose 36 percent in 2010, but in January the company projected disappointing estimates for 2011 earnings. Goldman Sachs analysts said the stock was “fully valued.” Analysts surveyed by Bloomberg expect the company’s sales growth to slow from 25.5 percent year-over-year in the second quarter of 2011 to 0.35 percent in 2012′s first quarter.
First Solar Inc.
Industry: Energy-alternate sources
Total return: -63.3 percent
Solar manufacturers such as First Solar (FSLR) face an increasingly competitive industry. Prices have fallen for solar panels as demand from Europe has slowed and Chinese producers boost output. Three U.S. solar companies, including Solyndra, declared bankruptcy in 2011.
Total return: -62.2 percent
Netflix (NFLX) shares rose 442 percent from the beginning of 2010 until July 2011. That advance stalled when customers didn’t like changes to the pricing and terms for Netflix’s video-streaming and DVD-by-mail subscription services. The company lost 800,000 U.S. subscribers in the third quarter of 2011.
Total return: -62.0 percent
MEMC Electronic Materials (WFR) is contending with a downturn in two of its end markets, the solar and semiconductor industries. Analysts surveyed by Bloomberg estimate that revenue will drop 13 percent year-over-year in the first quarter of 2012, while the company posts a loss of 4 cents per share.
Total return: -59.8 percent
Alpha Natural Resources (ANR) bought rival Massey Energy on June 14, months after an explosion at Massey’s Upper Big Branch coal mine killed 29 people. In August, executives said they would have difficulty getting planned cost savings from the combination. In September, they warned that production would be lower than expected.
Now past performance does not predict future performance as some of these losers stocks of 2011 were on the winners lists of stocks of 2010. However, watching what these names are doing and listening to their conference calls will tell you what the future holds. Some of these worst performing stocks of 2011 might be winners in 2012 if some things change.
Vinny's Stock Watch
INDU 0.00 N/A N/A NASDAQ 4062.521 +29.356 +0.73% S&P 500 1805.09 +20.06 +1.12% F 16.70 -0.04 -0.24% AKAM 44.95 -0.17 -0.38% FFIV 83.59 +2.09 +2.56% GOOG 1069.87 +12.53 +1.19% NFLX 354.44 -3.62 -1.01% DECK 85.03 -0.57 -0.67% OPEN 81.66 +0.35 +0.43% DNDN 3.01 -0.01 -0.33% WLT 15.17 -0.33 -2.13% SCCO 25.01 +0.23 +0.93% GMCR 71.30 +1.97 +2.84% EPD 62.13 +0.66 +1.07% 1970-01-01 00:00
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