2013 was quite a year for the equities markets, with records set by two of the three major indices and the S&P 500 up nearly 30%. Even in a red-hot market, not all stocks are created equal. Here are five we followed at Online Trading Academy; some did dramatically better than the overall market while others managed to march in the opposite direction, but all were fun to watch and exciting to trade.
Analysts made dire predictions for the future of Netflix in August 2012 after it split its DVD and streaming video businesses and announced a dramatic subscription price increase. Subscribers left, and shares sank, opening 2013 in the low 90s. Despite this, the subscribers came back and so did investors, lifting the price to a year-end close over 382—more than a 400% increase making NFLX the top performer in the S&P 500.
Tesla Motors (TSLA)
Part of the appeal of this company is its product—the super-fast, super-green Tesla S electric sports car. Tesla caught fire in early may, with a daily volume increasing from under 1 million to over 28 million shares. After starting the year at under $40 per share, TSLA climbed to over $190 on September 30. Then Tesla caught fire again when battery explosions had been reported in some of its vehicles. TSLA slumped to under $120, before recovering to $150 at year end.
Best Buy (BBY)
Best Buy had a terrible 2012. Founder Richard Schulze left under a cloud and failed at an LBO, and the stores had become an online showroom for shoppers who would check out the goods in person, then order them from Amazon. Amazon leveled the playing field after it started charging sales tax, and Schulze returned as Chairman Emeritus. Store sales strengthened throughout the year and, after declining 40% during 2012, BBY climbed from $12.12 to $39.88 during 2013.
J.C. Penny (JCP)
Here’s the BBY retail story, but in reverse. After struggling for several years, J.C. Penny hired Apple hotshot Ron Johnson who attempted to turn around the discount retailer by eliminating discounts. The results were disastrous, and by the time Johnson was fired in April JCP had dropped from a high of $23 to $14 per share. Sales continued to stagger but firmed slightly during the holiday season, suggesting the store may not be dead yet. Even so, JCP fell from $20.50 to $8.88 during 2013, nearly a 57% decline.
Does anyone knows how much Apple is really worth? Does anybody actually care? In 2012, it was briefly the most valuable company in the world, priced over $700 per share. After opening 2013 at $553.82, AAPL plummeted below $400 in April, and many media gurus predicted it would go still lower, but the price recovered (in spite of less than stellar sales for its latest iPhone, and no significant new releases in the pipeline) and AAPL closed the year at $561, or virtually unchanged.
Which one of these stocks do we like for 2014? All of them! What they have in common is volatility, making them ideal candidates for our patent-pending strategy which allows us to pick high-potential, low-risk opportunities based on price performance. To find out more about this strategy, enroll in a free half-day class at your local financial education center.