2021 has been a great year for owners of shares and other assets. Prices of stocks, real estate and cryptocurrencies have soared, vastly enriching investors. The only major asset class to fall this year is bonds. As inflation soared, bond prices slid. Thus, the global bond market is down almost 5% in 2021, its worst year since 1999. Meanwhile, the FTSE 100 index has gained 11.6% over 12 months, while the US S&P 500 has surged by 26.5%.
The FTSE 100’s year: 77 winners, 23 losers
A total of 100 stocks have been in the FTSE 100 for at least a year. Of these, 77 have risen in value, with gains ranging from 74.5% to 0.5% (excluding dividends). Therefore, only 23 Footsie shares lost value over 12 months, with losses ranging from 0.6% to 26.8%.
Of the 77 FTSE 100 winners over one year, 59 have recorded double-digit returns, gaining 10%+. Furthermore, 42 Footsie stocks have jumped by at least 20% since Christmas 2021. Even more impressively, 20 Footsie shares have leapt by at least 30% over one year. Finally, six super-stocks have soared by 50%+ over 12 months. Wow.
The Footsie’s six biggest winners
For the record, these are the FTSE 100’s six biggest winners since Christmas 2020. As you can see, each stock has leapt by at least 50% over one year, with gains ranging from 50.7% to 74.5%. The average rise across all six champion shares is a handsome 61.1%. That’s nearly 50 percentage points ahead of the wider index.
|Ashtead Group||Equipment rental||74.5%|
|Glencore||Mining & trading||60.3%|
|Royal Mail||Postal services||55.2%|
Most of the impressive gains in these share prices have been driven by underlying business improvements driving higher earnings. However, one FTSE 100 stock — aerospace manufacturer Meggitt — is the subject of a £6.3bn takeover offer by US rival Parker-Hannifin. As a result, Meggitt stock has exploded by 86.2% since it closed at 397p on 19 July.
Which superstar stock would I buy today?
I don’t own any of these six star shares today, but which would I buy for 2022? For me, Meggitt is out, because much of its future value is already baked into its current share price. Also, with Ashtead’s share price only 8.5% below its record high, this high-flying stock looks highly priced to me. Likewise, at over 33 times earnings, Glencore shares look fully priced to me. I’ll also reject Croda International due to its bumper price-to-earnings ratio (above 55). In addition, I’m not a big fan of commercial property right now, so Segro is a no-no for me.
Hence, the FTSE 100 high-flier I’d buy today is a ‘boring, old-fashioned’ business, Royal Mail. On Christmas Eve, Royal Mail shares closed at 507p, valuing the universal postal service provider below £5.1bn. Over the past 12 months, this stock’s price has ranged from a low of 298.3p on 21 December 2020 to a high of 589.62p on 7 June 2021. Currently, it trades 14% below its 52-week high.
Right now, this looks like a classic value stock to me. The shares trade on a lowly price-to-earnings ratio of 5.8 and an earnings yield of 17.2%. Also, they offer a cash dividend yield of 3.3% a year, slightly below the FTSE 100’s 4% yield. That said, Royal Mail has been a ‘value trap’ in the past, so I’m hoping that its parcel-delivery arm has had a bumper Christmas. If not, then I imagine this share might be rather volatile in early 2022!
The post These were the FTSE 100’s 6 biggest winners in 2021! appeared first on The Motley Fool UK.
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Cliffdarcy has no position in any of the shares mentioned. The Motley Fool UK has recommended Croda International. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services, such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool, we believe that considering a diverse range of insights makes us better investors.