Search This Blog

Wednesday, December 28, 2011

Good, Bad & Ugly of 5yr stocks- Part II

The last business week of the year is usually a slow one in the stock market-- trading volume is low, most people are on vacation, and so any ups or downs really don't mean anything beyond the immediacy of the moment.  So we're not really going to waste time covering it until next week.

We did want to continue a little game we played a week or so ago called 'Good, Bad & Ugly" where for fun, one finds out how much would a $100,000 investment in a particular stock be worth today, if purchased  exactly 5 years ago today.

Let's start with some 'Good':
YUM! brands (They own Pizza Hut, Taco Bell, KFC...)


December 28, 2006  --  $29.40  (3401 shares based on $100k)
December 28, 2011  --  $58.98

People love their pizza and other greasy fast food..  that initial $100k investment would be worth $200,590 today.

McDonald's

December 28, 2006  --  $44.33  (2255 shares based on $100k)
December 28, 2011  --  $99.58

A person who held onto McDonald's stock would have seen a profit of over 100% and a net worth of  $224,552

Dollar Tree 

December 28, 2006  --   $20.06  (4985 shares based on $100k)
December 28, 2011  --   $83.90

This would have been an excellent stock to have bought 5 years ago.  Today, you'd have a net worth of $418,245, a profit after 5 years of over $318k

Now once again, we merge 'Bad' and 'Ugly'.  Obviously no one would hold onto a crashing stock for five straight years but for academic exercise, we'll pretend there's some silly-stupid people out there who would and these would be the repercussions:

Alcoa

December 28, 2006  --  $30.01  (3332 shares based on $100k)
December 28, 2011  --   $ 8.52

A silly-stupid person who held onto Alcoa for 5 years would have $28,388 left from an original $100k investment.

Sears

December 28, 2006  --  $167.93  (595 shares based on $100k)
December 28, 2011  --   $33.33

The stock has dropped slowly up until the last few months.  Nonetheless, that $100k investment is now worth $19,831, a drop of over 80% in 5 years.

American Apparel, Inc.

December 28, 2006  --  $ 9.19  (10,881 shares based on $100k)
December 28, 2011  --   $ 0.76

Yes, American Apparel is worth less than $1 per share, and a silly-stupid person would have $8,269 left after his/her initial $100k investment

The Morale: Stock market is a crap game.  You can win big, you can lose big...

Question is-  Do you feel lucky?