In just a few weeks, markets will end the third quarter – a back-to-school time if ever there was one, because what was true in 2015 has turned false in 2016. Or, if you prefer: For some investments, the thrill is gone and the chill’s hit home.
And if you’re hoping at least the rest of the year will be smooth sailing with that portfolio crystal ball of yours, hold on, hang tight and hide your head. One of the wildest presidential elections on record promises to rock the stock market in ways to defy even the most self-assured pundit.
Still, some stocks have tilted one way or the other enough to maintain their trajectories in the face of election year headwinds. Here we present seven stocks ripe for rating on the hot-or-not scale.
Oneok (OKE): Cooking with gas. It’s uncertain when the energy sector will rebound and by how much. But Oneok is already lighting a profit flame. Based in Tulsa, Oklahoma, this natural gas company has seen its stock catapult more than 80 percent since January, and trades at $45 per share. Oneok has benefited from a jump-start in one key energy sub-sector, oil and gas storage and transportation. “This group has gained 33.7 percent in value on a year-to-date basis,” says Andrew Birstingl, research analyst at FactSet Research Systems in the greater New York City area.
Netflix (NFLX): A chilly stream. Think back to 2015, when Netflix dominated, finishing the year up 130 percent. Investors got giddy as experts predicted the demise of cable, due to consumers “cutting the cord” for streaming services. But 2016 has been an opposite story for the House Reed Hastings Built. NFLX has tumbled close to 30 percent since December and nagging questions remain as to how Netflix will build its subscriber base. Nor did it help when rumors of an investment by Alibaba Group Holding (BABA) were quashed earlier this month.
McDonald’s Corp. (MCD): Fire up the grill. “MCD is a behemoth,” says Bob Johnson, president and CEO of The American College of Financial Services in Bryn Mawr, Pennsylvania. “It has a market cap of more than $100 billion,” and profits are on the menu following CEO Don Thompson’s departure in 2015. MCD has rallied 20 percent the last 12 months to $119 per share – not quite the record of $131.60 hit in May, but a solid indication new CEO Steve Easterbook has put the world’s largest fast food chain back on track.
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Eagle Pharmaceuticals (EGRX): Uncommon cold. This Eagle soared from $14 per share in mid-July 2014 to an eye-popping $91 in mid-July 2015. But since then, Eagle has surrendered more than 40 percent of those profits with share prices down to $56. In February 2014, Teva Pharmaceutical Industries (TEVA) entered into an exclusive licensing agreement for the drug bendamustine, used to treat leukemia and lymphomas. But the blockbuster sequels some industry experts forecast haven’t materialized, leaving the buy-and-hold crowd to wonder whether their hold on profits is slipping.
Tronc (TRNC): Tepid expectations. It’s too soon to tell whether the risky rebranding of the storied Chicago Tribune newspaper franchise will bear e-fruit. The name change is all about promoting digital content, though it’s also inspired laughter. But those down on the moniker, and media stocks in general, might be surprised to learn TRNC stock is up two-thirds this year, trading at $15 per share. What’s more, tronc could hit profitability by 2019, according to analysts following the company.
Twitter (TWTR): #frozen. After Microsoft Corp. (MSFT) bought LinkedIn Corp. (LNKD) for $26.2 billion in June, Twitter shareholders could only look on in envy. Twitter has lost close to three-fourths of its value since January 2014, and has skidded throughout 2016. True, Twitter is arguably indispensable for its 300 million-plus monthly active users. But turning that volume into revenue has posed a problem. “Twitter’s biggest enemy is its simplicity,” says Andy Kapyrin, director of research at RegentAtlantic Capital in Morristown, New Jersey. “It’s a social network with only one feature: sound-bite comments.”
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Volkswagen Group: Cold road ahead. The wreckage of last September’s scandal, where the German automaker got caught cheating on U.S. emissions tests, is a year in the rearview. After dumping CEO Martin Winterkorn, VW stumbled back. Its stock is up 19 percent since the scandal, trading at $141 per share. But the bump may be short-lived, says K C Ma, director of the Roland George Investments Institute at Stetson University in DeLand, Florida. “We are pessimistic. It will take a long time for the market to realize that VW has been investable.”
Between bored stares at the stock market screen crawl, it’s a safe bet that many an investor – OK, most of us – will daydream about what it would be like to find the next Google, circa 2004. Or the next Alexion Pharmaceuticals, circa 1996. Alexion what? Stocks that make earnings history need not be household names, and Alexion’s drugs have returned more than 49 times its share price over two decades. From the kings of coffee and the princes of pharmacy to the rulers of retail here are seven stocks that have made shareholders love them so much they can hardly count the ways, let alone the digits on the ledger.
Altria Group (ticker: MO)
(FABRICE COFFRINI/AFP/Getty Images)
At the dawn of 1978, stock in the former Philip Morris traded for 56 cents a share, less than the cost of two packs of cigarettes. And while smokes have certainly gone up in price, Altria is smoking like a fiend: up an astounding 1,476 percent. That even takes into account a scary ride in 2008 when the stock lost 70 percent of its value in less than a month, though it’s headed steadily upward over the last seven years.
10 shares, 1978: $5.60
10 shares today: $679
Keurig Green Mountain
(Joe Raedle/Getty Images)
Keurig proved you can have a bomb and still be da bomb. It plunged 63 percent between January and November 2015 thanks to a new home soda system that met with scathing reviews. But grape soda is nothing compared to champagne, which ground-floor investors uncorked long ago. In 1993, it’s stock sold for 50 cents a share. When the firm went private in March, shareholders cashed out at $91.70: Toast that with coffee, rye or whatever else they put in K-cups these days.
10 shares, 1993: $5
10 shares, 2016: $917
Alexion Pharmaceuticals (ALXN)
In creating drugs for ultra-rare immune system diseases, Alexion returns ultra-rare profits. You’ve likely never heard of (or can pronounce) paroxysmal nocturnal hemoglobinuria or atypical hemolytic uremic syndrome. But as the medication to these conditions, “Soliris is the first and only approved therapeutic,” says K.C. Ma, director of the Roland George Investments Institute at Stetson University in DeLand, Florida. “Alexion has placed itself into a market with virtually no competitors. Soliris costs Medicare $400,000, per patient, per year, for life.”
10 shares, 1996: $23
10 shares today: $1,130
(Justin Sullivan/Getty Images)
Known for “moonshot” projects such as driverless cars, Alphabet has been a successful shot into the shareholder stratosphere. The day after its Aug. 19, 2004, IPO, the former Google traded for $54.21 a share. Today, Alphabet trades for about $680 (GOOG) and $691 (GOOGL). “Google turned a dominant position in internet search into the world’s leading digital advertising platform,” says Andrew Wetzel, portfolio manager and senior research analyst at F.L. Putnam Investment Management Co. in Wellesley, Massachusetts.
10 shares, 2004: $542
10 shares today: $6,910 (GOOGL), $6,800 (GOOG)
Monster Beverage Corp. (MNST)
(Justin Sullivan/Getty Images)
What started as a granola muncher (the Hansen Naturals juice and soda line) became a bone cruncher that’s pummeled sports drink competitors. Today MNST trades for $154.50, but in 2001 you could’ve sucked up shares at just 24 cents. So why do few people know about this historic run-up? “Tech stocks have captured the spotlight with most investors and financial publications, while Monster’s remarkable performance has gone largely unrecognized,” says Gerald Jensen, a professor at Creighton University’s Heider College of Business in Omaha.
10 shares, 2001: $2.40
10 shares today: $1,545
Wal-Mart Stores (WMT)
(The Associated Press)
The past year or so hasn’t been kind to the Bentonville, Arkansas, super-retailer with its publicized labor troubles and a stock price that’s remained flat at $71.50 per share. But turn the clock back to Oct. 1, 1970, when the chain had roughly three dozen stores, and you could’ve snagged the bargain of a lifetime. “After 11 two-for-one stock splits, you – as an original IPO investor – would have 20,480 shares,” says Keith Baker, professor of mortgage banking at North Lake College in Irving, Texas.
10 shares, 1970: $165
10 shares today: $1,454,100
Berkshire Hathaway (BRK.A)
Rumpelstiltskin spinning straw into gold? That’s fiction. Warren Buffett turning a foundering New England textile company into Fort Knox? That’s the much stranger truth. In 1962, when he was the Nobody of Omaha, Buffett started buying shares at about $7 a shot. Today, a single share of Berkshire’s Class A stock sells for $210,400 – almost 50 percent more than the median home price in Buffett’s home town. The return since ’62? You only needed five shares to become a millionaire.
10 shares, 1962: Less than $80
10 shares today: $2,104,000