10 Best-Performing S&P 500 Stocks of 2012
The benchmark is up 12%, driven by an improvement in the U.S. economy and increased efforts to solve Europe's debt crisis. In addition, the potential for new monetary stimulus is still on the table based on Fed Chairman Ben Bernanke's speech last week.
With such a solid run in the first quarter of 2012, which came after a 11.4% increase in the S&P 500 in the last quarter of 2011, many investors are nervous that a pullback is in the cards. Sam Stovall, chief equity strategist at S&P Capital IQ, says the opposite is more likely.
"Since 1945, in the eight times the S&P 500 was up 10% or more in Q1, it gained another 3.3%, on average, in Q2," he says.
The 10 best-performing components of the S&P 500 so far this year have gained between 50% and 117%, topped by Sears. Unlike that department-store chain, high-fliers such as Priceline.com(PCLN) and Salesforce.com(CRM) rose last year -- and keep moving up.
In the reverse order of performance, here are the S&P 500's 10 best-performing stocks in 2012 :
10. Pulte Group (PHM)
Performance: up 50.2% (up 26.0% from year-end 2010)
Company profile: Homebuilder with a presence in 28 states, mostly in the East, Gulf Coast, Central and West regions of the U.S.
Investor takeaway: PulteGroup has benefitted from the improvement in the housing market, which seems to be bouncing along the bottom. Expectations for a solid spring selling season as the economy improves have also played a factor in the more recent performance of the stock.
Selling, general and administrative costs at the company are lower than they are at other homebuilders. The company significantly reduced debt in the fourth quarter and now has about $1.2 billion in cash as a cushion.
9. Salesforce.com (CRM)
Performance: up 51.8% (up 16.7% from year-end 2010)
Company profile: Salesforce.com is the leading provider of business software applications over the Internet. Salesforce.com has more than 92,300 customers around the world and derives more than 30% of its revenue from overseas.
Investor takeaway: Salesforce.com shares jumped Feb. 24 after the company reported solid fourth-quarter earnings. Since then, the stock has continued its ascent.
The company helped pioneer the "cloud computing" movement. Potential customers are recognizing the advantages of keeping software applications on remote servers: it saves money, software can be upgraded more easily and it's convenient. Salesforce says it completed four times the number of seven-figure deals last quarter compared with a year earlier, including one with Hewlett-Packard(HPQ) , and in the first quarter scored its first nine-figure deal, with an anonymous company.