Blue Chip High Fliers and Dogs
Within the blue-chip S&P 100 (the largest stocks in the US), there are currently ten stocks that are up at least 40% over the last two years and 20% over the last three years. Below is the list of these names sorted alphabetically. For each stock, we also include its market cap, its dividend yield (if it pays one), its next-year estimated P/E ratio, and of course, its 2-year and 3-year percentage change.
On average, these ten stocks have a dividend yield of around 1% and a forward P/E ratio of 27.9. Over the last two years, they’ve averaged a gain of 86.5%, while they’ve rallied an average of 123.7% over the last three years. While stocks like Advanced Micro (AMD), Broadcom (AVGO), and NVIDIA (NVDA) made the list, it’s not all Tech stocks. It also includes names like Costco (COST), General Electric (GE), Eli Lilly (LLY), and T-Mobile (TMUS) made the list as well.
While the NVDA’s and Eli Lilly’s (LLY) of the investment world have been on fire recently, there are also plenty of well-known blue-chip stocks that have been beaten down over the last few years. You can probably name a few off the top of your head, but below is a list of the eleven stocks in the S&P 100 that are down at least 20%+ over each of the last two and three years. This list is a who’s who of big-name companies that have been taken to the woodshed since early 2021. It includes names like Disney (DIS), General Motors (GM), 3M (MMM), Nike (NKE), Pfizer (PFE), Target (TGT), Tesla (TSLA), and Verizon (VZ).
A good thought exercise is to decide where you would rather put new money to work in the equity market right now. Would you go with the ten big winners above that have seemingly endless upside momentum, or would you rather go with the beaten-down blue-chips below that can’t seem to get out of their way? Of the two baskets, which do you think will outperform over the next year; the next two years; or the next three? We have our own opinion on the topic here at Bespoke, but the basket you decide on probably speaks volumes about the type of investor you are as well.
Nonstop Nasdaq
The mega-cap Tech-heavy Nasdaq 100 is up nearly 1% today as of this writing, which leaves it up 4.5% already in 2024. It’s been about a month now since the Nasdaq 100 took out its prior all-time highs from late 2021, but as shown in the chart below, the index is already 5.9% above those prior highs as the breakout continues.
Two more noteworthy stats:
The Nasdaq 100 is now up 64% during its current bull market that began on 12/28/22.
And, since the COVID Crash low that the Nasdaq 100 made on 3/20/20, the index is up a whopping 150%.
Below is a table showing historical bull markets for the Nasdaq 100 since the index came to be in the mid-1980s. The current bull market is its 16th using the standard 20%+ rally definition, and this bull is now right at the median when it comes to gains and length. As shown, the current bull has seen a gain of 64.3% over 392 days. The median gain for all Nasdaq 100 bull markets is a gain of 64.5% over 407 days.
When it comes to the average bull market, however, the current bull has a ways to go. Because of two very lengthy bulls that saw 600%+ gains in the 1990s and 2010s, the average bull market looks much different than the median bull market. As shown in the table, the average Nasdaq 100 bull market has seen a gain of 163.2% over 799 days — which is basically double the length and 100 percentage points stronger than the median bull.
