Most-Admired Companies: How the Stocks Did One/Five/Ten-Years

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Fortune’s Most Admired Companies List -- based on a survey of thousands of executives, board members and analysts – is led this year by great consumer brands and if you’d loaded up on the top five a year ago, you’d have smoked the market thanks to huge advances by Google (GOOG) and Amazon (AMZN).

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AAPL Chart

The Apple (AAPL) exposure would have cost you and Coca-Cola (KO) and Starbucks (SBUX) roughly kept pace with the S&P 500. No telling how the stocks will do over the next year, of course, and as an investor it’s the predictive power of such lists you’d be most interested in.

So, how do Most Admired Companies do over the longer term? Looking back five years, the 2008 top five would also have smoked the S&P 500 thanks to enormous gains by Apple and Google. Berkshire Hathaway (BRK-B) roughly matched the S&P 500, and General Electric (GE) and Toyota (TM) lagged badly.

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AAPL Chart

A chart based on the 2003 top five Most Admired Companies, shows if you’d loaded up on those stocks and held on, you’d be miserable. Berkshire, with an awful market plunge included in the 10-year period, performs like a champ. And Wal-Mart (WMT), most admired in 2003, manages a 48% rise, so those two combined roughly match the S&P 500’s 88% advance. But you’re stuck with three long-term losers: Southwest Airlines (LUV), a great company in a horrible industry; Dell (DELL), admired then for having made PCs cheap, but yet to have to live long-term with the market it wrought; and General Electric, still admired for its stair-step earnings growth and industrial/finance mix, which of course would be a disaster a few years later.

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WMT Chart

Fortune’s soothsayers seem worth listening to, if only for the short- and medium-term.

From the editors of YCharts. We can be reached at editor@ycharts.com.


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