2012 Winners And Losers: Where To Look Next

As 2012 ends, it is time to look at the sectors that did the best. The best market performers went to the financial sector, up 27.65% and nearly double the return of the S&P 500 index. The sector benefited from a return of around 120% from Bank of America (BAC). At the start of last year, the company traded well below its book value, which is somewhere in the 20’s. A gloomy cloud that held back shares was its unknown liability in the mortgage market. Since then, housing prices improved in places like Phoenix (up 21.7%). Citigroup (C) shares were up around 54% in 2012.

Consumer Discretionary rose 22.81% in the year. Companies like Comcast (CMCSA), Home Depot (HD), Amazon (AMZN), and Walt Disney (DIS) helped generate strong returns. Home Depot and Amazon surprised many: housing was assumed to be weak, which proved wrong. Amazon’s stratospheric high P/E failed to stop shares from rising nearly 50% in 2012.

The Health Care sector was up 16.74%. Companies like Pfizer (PFE) did well, while also paying dividends.

Only Utilities generated a negative return, but the chart may not have included dividend returns.

For companies on the S&P 500, EBAY (EBAY) outperformed the majority of technology stocks on the index. eBay closed recently at $53.59 and for 2012, shares were up 68.5%. Companies performing better than eBay were Expedia (EXPE), up 112%, Seagate Technology (STX), up 85%, and Computer Sciences Corp. (CSC), up 69%.