At 7 years into the bull market USA Today looks at stocks that have rewarded patient investors with epic gains. The ultimate recovery stock among this is General Growth Properties.
The bull market turns seven on Wednesday, a happy milestone for just about all investors. But it’s been an even more spectacular period for those who had invested in one of ten stocks in the current Standard & Poor’s 500 index, including real estate investment trust General Growth (GGP), biotech Regeneron Pharmaceuticals (REGN) and sports apparel maker Under Armour (UA). These stocks each scored incredible gains of 1,500% or more during the past seven years since the bull started on March 9, 2009, according to a USA TODAY analysis of data from S&P Global Market Intelligence.
REIT General Growth is the biggest darling of this bull market, up a stellar 7,295% since the bull market started seven years ago. The company, which is based in Chicago and owns shopping malls, has staged strong performance not just in terms of its stock, but also its bottom line. The company posted a net loss of roughly $1.3 billion in 2009, but had posted a net profit of $1.4 billion in 2015. Shares have soared from 38 cents seven years ago to $27.97 today. The stock “did so well because during the great recession ten years ago, General Growth declared bankruptcy (protection) due to a high level of floating rate debt which sent the common stock almost to zero,” says Paul Adornato, research analyst at BMO Capital Markets. “The stock was trading for pennies during this time.”
Those who stayed with or purchased General Growth at the bottom have been amply rewarded. And what other stocks have performed spectacularly during the recovery?
The second stock on the USA Today list rose 3,084 percent during the recovery. According to The Street Regeneron Pharmaceuticals still has potential.
Regeneron Pharmaceuticals, Inc., a biopharmaceutical company, discovers, invents, develops, manufactures, and commercializes medicines for the treatment of serious medical conditions worldwide. REGN has a PE ratio of 82. Currently there are 10 analysts that rate Regeneron Pharmaceuticals a buy, 2 analysts rate it a sell, and 7 rate it a hold.
The average volume for Regeneron Pharmaceuticals has been 811,900 shares per day over the past 30 days. Regeneron has a market cap of $42.9 billion and is part of the health care sector and drugs industry. The stock has a beta of 1.81 and a short float of 4.7% with 2.81 days to cover. Shares are down 26.9% year-to-date as of the close of trading on Friday.
While the stock has taken a hit this year The Street sees the stock as a pre-market laggard that has the potential for more profit.
Picking Potential Recovery Stocks
How would you have known that General Growth was going to come back strong from bankruptcy? General Growth has been the largest of one of the largest managers of retail space in the world. They had been in business for more than 50 years when the Great Recession hit. Although the company had a lot of revolving debt it had a very solid business plan and position in its market niche. As such one might well have seen it as the ultimate recovery stock and either held onto it or purchased shares when it was selling for pennies on the dollar.