The 20 Best-Performing Stocks of the Last Decade
Hindsight is 20/20. It can be incredibly difficult to pick the “next big stock” in the moment, but looking back gives us clarity on where we could have reaped the highest rewards. While some of the decade’s chart-toppers—like Netflix and Amazon—are household names, other stocks may come as a surprise.
Today’s visualization reveals the best-performing stocks over the last 10 years, and shows how much an initial $100 investment would be worth today.
To compile the list, MarketWatch reviewed the current S&P 500 constituents and excluded any stocks that have traded in their present form for less than 10 years. The remaining companies were sorted based on their total return, with reinvested dividends, from December 31, 2009 to December 5, 2019.
So, which stocks come out on top? Here’s a full list of the top 20, organized by ranking:
|Rank||Company||Ticker||Final Value of $100 Investment||S&P 500 Sector|
|1||Netflix Inc.||NASDAQ: NFLX||$3,867||Communication Services|
|2||MarketAxess Holdings Inc.||NASDAQ: MKTX||$3,282||Financials|
|3||Abiomed Inc.||NASDAQ: ABMD||$2,221||Health Care|
|4||TransDigm Group Inc.||NYSE: TDG||$2,165||Industrials|
|5||Broadcom Inc.||NASDAQ: AVGO||$2,019||Information Technology|
|6||Align Technology Inc.||NASDAQ: ALGN||$1,558||Health Care|
|7||United Rentals Inc.||NYSE: URI||$1,534||Industrials|
|8||Regeneron Pharmaceuticals Inc.||NASDAQ: REGN||$1,530||Health Care|
|9||Ulta Beauty Inc.||NASDAQ: ULTA||$1,333||Consumer Discretionary|
|10||Amazon.com Inc.||NASDAQ: AMZN||$1,309||Consumer Discretionary|
|11||Extra Space Storage Inc.||NYSE: EXR||$1,266||Real Estate|
|12||Constellation Brands Inc. Class A||NYSE: STZ||$1,224||Consumer Staples|
|13||Nvidia Corp.||NASDAQ: NVDA||$1,217||Information Technology|
|14||Take-Two Interactive Software Inc.||NASDAQ: TTWO||$1,214||Information Technology|
|15||Ross Stores Inc.||NASDAQ: ROST||$1,181||Consumer Discretionary|
|16||Fortinet Inc.||NASDAQ: FTNT||$1,179||Information Technology|
|17||Mastercard Inc. Class A||NYSE: MA||$1,178||Information Technology|
|18||Charter Communications Inc. Class A||NASDAQ: CHTR||$1,177||Communication Services|
|19||O'Reilly Automotive Inc.||NASDAQ: ORLY||$1,160||Consumer Discretionary|
|20||Cintas Corp.||NASDAQ: CTAS||$1,153||Industrials|
Note: The final value of a $100 investment is based on the total return, with reinvested dividends, from December 31, 2009 – December 5, 2019.
In comparison, $100 in the S&P 500 index overall would have amounted to $344 over the same time period. Let’s take a closer look at these strong performers.
Streaming giant Netflix takes the #1 spot. The company earned a staggering 3,767% return over the last ten years, meaning an initial $100 investment would now be worth almost $4,000. However, it remains to be seen whether Netflix’s first mover advantage will remain strong with new competitors entering the space.
One such rival, Amazon, takes its spot at #10 in the best-performing stocks of the decade. From its humble roots as an online bookseller, the company has transformed into an ecommerce leader. CEO Jeff Bezos credits Amazon’s admirable success to three key customer-centric factors: listen, invent, and personalize.
At #12 on the list, Constellation Brands—owner of several alcohol brands such as Corona—is also no stranger to invention. The company is protecting itself against cannabidiol (CBD) disruption with a $5 billion dollar investment in Canopy Growth, and future plans to create its own CBD-infused beverages.
Other well-known names on the top 20 list include discount department store chain Ross Stores (#15) and the credit card company Mastercard (#17), with the latter benefiting from an oligopoly in the industry.
Flying Under the Radar
Apart from the names you’d expect to see, there are also some lesser-known companies that made the list.
Well established among institutional investors and broker-dealers, MarketAxess Holdings takes the #2 spot. The fintech company operates a global electronic bond trading platform, vastly improving the process for investors who traditionally traded bonds “over-the-counter”.
In third place, healthcare technology company Abiomed develops medical devices that provide circulatory support. The company’s Impella® device—the world’s smallest heart pump— has been used to treat over 50,000 U.S. patients.
Fourth place company Transdigm Group gains its stronghold by developing specialized products for the aerospace industry. It has a strong acquisition strategy as well, having acquired over 60 businesses since its formation in 1993.
A Sector View
If we organize the top 20 by sector, information technology stocks appear in the list most frequently with five companies, followed by consumer discretionary (4 companies), and industrials and healthcare (3 companies each).
Sectors with less representation in the top 20 are communication services (2 companies), as well as consumer staples, financials, and real estate (1 company each).
The Bottom Line
While these stocks have performed extremely well over the last decade, they are not necessarily the best portfolio additions today. Some companies may have become overvalued, or be facing new competition in their industry—as is the case with Netflix. It’s best to consider all current information when building a portfolio.
However, the top 20 stocks do demonstrate the power of a buy-and-hold strategy. If you’re lucky enough to identify a winner early on, it’s possible to simply sit back and let your dollars grow.
Tesla’s Valuation Surpasses Ford and GM Combined
Tesla is not only the top valued U.S. automaker, it’s now worth more than Ford and GM combined. Will the rally continue, or will short sellers win the day?
Chart: Tesla is Worth More than Ford and GM Combined
Tesla has been on a roller coaster ride of market sentiment in recent years, but the electric car company is starting off the new decade on a high note.
The company is not only America’s most valuable automaker, it’s now worth more than Ford and GM combined.
Tesla’s valuation has already surpassed the $100 billion mark – a significant milestone for a company that produces a fraction of the vehicles of its direct competitors.
Here’s a comparison of the top selling models in the U.S. for Ford, GM, and Tesla.
|Rank||Model||Unit Sales (Q4 2019)|
|7||Tesla Model 3||47,275|
A quick glance at this list is revealing. Though Tesla’s Model 3 put up strong sales numbers, it’s still only a small percentage of vehicles sold by U.S. automakers.
So, what’s driving Tesla’s meteoric growth, and is it sustainable? Below, we’ll take a high-level look at the bull and bear cases for the company.
The Bull Case for Tesla Motors
Tesla posted losses of $1.1 billion in the first half of 2019, but since then, the company has turned the situation around in dramatic fashion.
The automaker had a surprising third quarter with not only record deliveries of 97,000 cars, but also a profit of $143 million. Deliveries broke yet another record in Q4 2019, totaling 112,000 vehicles. These announcements helped improve market sentiment, sending the company’s stock back on an upward trajectory heading into 2020.
Here are three reasons some analysts and media are still bullish on Tesla:
1. Tapping into the World’s Largest Electric Car Market
For a long time, foreign companies looking to manufacture products in China couldn’t do so without working through a domestic partner. Recently though, Tesla became the first major benefactor of a policy change, becoming the first wholly foreign-owned automaker in China.
Gigafactory 3 in Shanghai was completed in October, and was built in just 10 months – an impressive feat. Furthermore, cars have already begun rolling off the assembly lines, as Tesla targets an annual production of 150,000 Model 3s.
Perhaps the best part for a company with historically volatile earnings: Tesla claims the facility was 65% cheaper to build than its production plant in the U.S.
2. Still the Range King
2019 saw many of the more established automakers take their first swings at Tesla.
The United States Environmental Protection Agency (EPA) handed out official range ratings for several new electric cars, but none could unseat the king:
3. Musk’s Megaphone
Few CEOs capture the attention of media quite like Elon Musk. While his actions can sometimes have unintended consequences for the company – the infamous “funding secured” tweet, for example – Elon Musk’s massive reach allows the company to sell vehicles without spending a dime on advertising.
By contrast, in 2018, Ford and GM spent $2.3 billion and $3.1 billion respectively on advertising in the U.S. alone.
The Bear Case for Tesla Motors
While the second half of 2019 has given Tesla bulls much to celebrate, many investors are remaining vigilant, if not skeptical.
1. Stiff Competition in China
Tapping into the world’s largest EV market is a double-edged sword for Tesla, as they face an onslaught of domestic and foreign competitors.
The Chinese government has also generously supported its own EV industry, handing out over $60 billion in subsidies to over 400 companies. Tesla will be competing against state-owned enterprises like BAIC, one of the largest players in the Chinese EV market.
Western automakers are also gaining a foothold in China as well. Volkswagen and its Chinese joint-venture partner, SAIC Motor, will begin producing cars at two factories in China in the autumn of 2020.
The German automotive giant has also forged partnerships with Chinese battery manufacturers, including China’s biggest battery company Contemporary Amperex Technology (CATL).
2. Getting Ratio’d
Tesla has an extremely high premium on earnings when compared with its more established counterparts in the auto industry.
|Company||Ticker||Enterprise Multiple* (last 12 months)|
The enterprise multiple (EV/EBITDA) measures the dollars in enterprise value for each dollar of earnings. The ratio is commonly used to determine if a company is undervalued or overvalued compared to peers.
The Bottom Line is… the Bottom Line
Of course, Tesla’s future will be dictated by variables more complex than can be summed up in a tidy pro/con list.
Musk has shown a willingness to sacrifice profitability in the name of growth – Tesla has yet to prove it can deliver consistent, quarterly profits.
It’s hard to be profitable with that level of growth. We could slow it down, but then that would not be good for sustainability and the cause of electric vehicles.
– Elon Musk
After reporting a record number of deliveries in the final quarter of 2019, there’s no doubt that true believers and short sellers alike will be watching the company’s January 29, 2020, earnings call with much anticipation.
How China Overtook the U.S. as the World’s Major Trading Partner
China has become the world’s major trading partner – and now, 128 of 190 countries trade more with China than they do with the United States.
How China Overtook the U.S. As the World’s Trade Partner
In 2018, trade accounted for 59% of global GDP, up nearly 1.5 times since 1980.
Over this timeframe, international trade has transformed significantly—not just in terms of volume and composition, but also in terms of the countries that the rest of the world leans on for their most important trade relationships.
Now, a critical shift is occurring in the landscape, and it may surprise you to learn that China has already usurped the U.S. as the world’s most dominant trading partner.
Trading Places: A Global Shift
Today’s animation comes from the Lowy Institute, and it pulls data from the International Monetary Fund (IMF) database on bilateral trade flows, to determine whether the U.S. or China is a bigger trading partner for each country from 1980 to 2018.
The results are stark: before 2000, the U.S. was at the helm of global trade, as over 80% of countries traded with the U.S. more than they did with China. By 2018, that number had dropped sharply to just 30%, as China swiftly took top position in 128 of 190 countries.
The researchers pinpoint China’s 2001 entry into the World Trade Organization as a major turning point in China’s international trade relationships. The dramatic shift that followed is clearly demonstrated in the visualization above—between 2005 and 2010, a number of countries tipped towards Chinese influence, especially in Africa and Asia.
Over time, China’s dominance has grown dramatically. It’s no wonder then, that China and the U.S. have a contentious trade relationship themselves, as both nations battle it out for first place.
A Tale of Two Economies
The United States and China are competitors in many ways, but to be successful they must rely on each other for mutually beneficial trade. However, it’s also the major issue on which they are struggling to reach a common ground.
The U.S. has been vocal about negotiating more balanced trade agreements with China. In fact, a mid-2018 poll shows that 62% of Americans consider their trade relationship with China to be unfair.
Since 2018, both parties have faced a fraught relationship, imposing major tariffs on consumer and industrial goods—and retaliations are reaching greater and greater heights:
While a delicate truce has been reached at the moment, the trade war has caused a significant drag on global growth, and the World Bank estimates it will continue to have an effect into 2021.
At the same time, China’s sphere of influence continues to grow.
One Belt, One Road, One Trade Direction?
China seems to have a finger in every pie. The nation is financing a flurry of megaprojects across Asia and Africa—but one broader initiative stands above the rest.
China’s “One Belt, One Road” (OBOR) Initiative, planned for a 2049 completion, is advancing at a furious pace. In 2019 alone, Chinese companies signed contracts worth up to $128 billion to start Chinese large-scale infrastructure projects in various countries.
While building new highways and ports abroad is beneficial for Chinese financiers, OBOR is also about creating new markets and trade routes for Chinese goods in Asia. Recent research found that the OBOR program’s infrastructure expansion and logistics performance improvements led to positive effects on China’s exports.
Nevertheless, it’s clear the new infrastructure network is already transforming global trade, possibly cementing China’s position as the world’s major trading partner for years to come.
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