S&P 500's Top Returners in 2009

With 10 months of 2009 behind us and the holiday season approaching, we decided to highlight some of the companies that have driven the market rebound in 2009. The companies in the list below have earned the largest total returns thus far year-to-date in the S&P 500.

Even though these companies have done well, one should be careful of the stocks that have run up and are now overvalued. Listed below are the top returners in the S&P 500 (excluding financials) and how these companies rank according to The Applied Finance Group’s valuation model.

Source: EconomicMargin.com

AFG's Valuation Metric – Measures the percent to target (deviation between a stock’s current trading price and its AFG current default target price). To derive the intrinsic value of a firm, AFG uses its proprietary Valuation Model (modified discounted cash flow model).

Economic Margin - A corporate performance measurement that addresses the gaps in GAAP, eliminating distortions caused by accounting policies to measure what a company is truly earning above or below their cost of capital.

Management Quality – Assesses management’s ability to make wealth creating decisions.

Comments

[Jon T:]

One of the few viewpoints I've seen in recent times that says APPL is an "Unattractive" stock.

Odd. Very odd.

Nov 11 08:14 AM

[relayer75:]

A stock's return since January 1, 2009 seems pretty arbitrary. A better question is, how far is the stock off its high of 2007? (most stocks have not remotely reached their late 2007 highs). Whole Foods, for example, was in the $50's in late 2007. Then it went straight down for over a year, bottoming around $7 right at 1/1/09. So, now it's at $28, up 238% since 1/1/09. Whoppdee frickin doo. It's still over 40% off its high. The only stocks on your list that are at or anywhere near their all-time highs right now are Western Digital (WDC), Apple (AAPL), Amazon (AMZN) and Cognizant (CTSH), with Amazon as the clear winner, having cleared $100 for the first time recently and now at $130. If today is an up day, AAPL will probably have its highest close ever (intraday high was $208.70, but closing high was $205.20). But you say these stocks are "overvalued", based on an un-defined (for the reader) proprietary "modified discounted cash flow" metric. Great, that and 4 bucks will get me a cup of coffee at Starbucks. Telling people to "be careful" of the stocks on this list, based on your undisclosed black box formula is about as useful as saying "past results are not indicative of future performance." Why don't you tell us what the S&P winners for the NEXT 10 months will be, now that might be useful!

Nov 11 08:58 AM

[PanamaBob:]

Who is the "we" of this piece? Unbylined articles are not just anonymous, they're a nuisance. PanamaBob

Nov 11 09:05 AM

[constantnormal:]

It would be nice see how the "valuation model" used to assess these stocks compares to things like PEG and price/(free cash flow per share).

Just tossing out the results from an ill-defined black box does not engender any confidence in me -- looks too much like a fund that is "talking its book".

Nov 11 09:24 AM