10 'Stocks of the Decade' Rise at Least 1,200%
Meanwhile, if that $1,000 would have been invested in the benchmark S&P 500 Index , it would have lost 19% of its value. Most of the decline would have occurred during the Great Recession, when the S&P 500 plummeted starting in the fall of 2008. The benchmark index is now at the highest level since summer 2008 as the U.S. and, now, Europe have adopted monetary policies to fuel a rally in riskier assets.
The top 10 stocks of the past decade represent a wide range of sectors. Energy firms and companies that offer unique products to their consumers have fared the best. Some could very well be great stocks to own over the next decade. Others will rely on trends in China or government regulation to mimic the growth they recorded in the past decade.
The 10 best-performing components of the S&P 500 have gained between 1,290% to 4,900%, topped by none other than Apple(AAPL) , maker of the iPod, iPhone and iPad.
In the reverse order of performance, here are the S&P 500's 10 best-performing stocks of the decade:
10. Cummins (CMI)
Company Description: Makes diesel engines for the truck, bus, auto, industrial and electric power generation industries. About 64% of revenue is generated outside the U.S.
10-Year Stock Performance: 1,290%
Investor Takeaway: The stock gained some solid upside between the start of the decade and 2008, but retreated during the global recession. After getting through 2008, earnings per share impressively grew at a compound annual growth rate (CAGR) of 29% between 2008 and 2011.
Over that same period, the stock tripled on strong demand in China and India, but as that demand weakened, North American picked up and the company started gaining share domestically. Plenty of trucking data out recently is expecting sales growth to continue for heavy-duty, commercial trucks that use Cummins engines.
Analyst Ratings: 75% Buy / 25% Hold
Current P/E Ratio vs. 5-Year Avg.: 14x / 16x
9. Joy Global
Company Description: Manufacturer of coal-mining equipment.
10-Year Stock Performance: 1,440%
Investor Takeaway: After falling off a cliff in 2008 with the rest of the stock market, Joy Global rebounded rapidly to 2011, which was a volatile year. The biggest concern for the company is the long-term secular decline of coal in the U.S.