by Jeff Reeves | August 29, 2012 6:15 am
There’s a lot of talk right now about a double-dip recession … though I’m not sure you can call it a double-dip if this much time has passed between the last downturn and a current/future one.
At any rate, you know the drill. Europe sucks. China is slowing down. American corporations can’t seem to grow the top line. The gloom-and-doom crowd is sharpening its knives as a result.
I won’t debate the “will we” or “won’t me” issue in this post. Rather, I’d just like to point out how the last crisis was not without opportunity.
Allow me to dust off the old platitude of it being a “stock picker’s market” and share a list of huge winners since the market’s peak in 2007. I’ve broken it down by sector to highlight growth flavors you might find similar this time around.
Since Oct. 9, 2007, when the Dow Jones Industrial Average closed at an all-time high of 14,164.53, the index is off 5%. But check out these returns for stocks that proved not just to be recession-proof, but huge profit machines:
Big-name standouts among blue-chip stocks tend to focus on technology:
Clearly all of these companies are playing on a 21st century economy where mobile technology and high-tech communication and commerce are not just stable businesses, but growth opportunities.
(I’m calling MasterCard a tech company because it’s more in the payment processing business than capital markets, and the prevalence of mobile payments and ecommerce along with the “cashless craze” in emerging markets makes this fit the mold in my mind.)
Other winners of note include biotechs that popped big — including a mammoth 4,900% for Questcor Pharmaceuticals (NASDAQ:QCOR) since October 2007, or the more modest 720% gain for Regeneron Pharmaceuticals (NASDAQ:REGN). I could go on with some that still are small-caps even after the run-up, but you likely haven’t heard of them. The idea is simply the power of biotech stocks to find a new treatment or in-demand drug regardless of the macro environment.
Another standout is HealthStream (NASDAQ:HSTM), an Internet-based health care training company that has soared 690%.
There are a few other picks worth noting that actually focused on consumers. These thrived despite the downturn and include names like Chipotle Mexican Grill (NYSE:CMG), up 149% since October 2007.
Smaller picks exist here, too — such as the very small-cap specialty retailer Kirklands (NYSE:KIRK), which is up about 800%.
Green Mountain Coffee (NASDAQ:GMCR) also saw a surge on the strength of its Keurig single-cup brewer and remains up 240% since October 2007 … though like the aforementioned NFLX, it has fallen off a cliff in the past 12-18 months.
Jeff Reeves is the editor of InvestorPlace.com and the author of “The Frugal Investor’s Guide to Finding Great Stocks.” Write him at firstname.lastname@example.org or follow him on Twitter via @JeffReevesIP. As of this writing, he did not own a position in any of the stocks named here.
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