3 Stocks That Surprised Markets By Significantly Outperforming In 2019
Investing.com | Dec 18, 2019 11:23
U.S. major indices are trading at all-time highs right now. Market concerns about the U.S.-China trade war have been resolved...at least for the moment. The benchmark S&P 500 index is up more than 27% in 2019, on track for its highest annual percentage gain in six years.
A dovish Federal Reserve along with mostly encouraging U.S. economic data have also helped push Wall Street stocks to record levels.
While most of the focus has been on the popular, mega cap, FAANG tech stocks such as Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), Facebook (NASDAQ:FB), Netflix (NASDAQ:NFLX), Google-parent Alphabet (NASDAQ:GOOGL), and Microsoft (NASDAQ:MSFT), we zeroed in on three less scrutinized equities, each of which vastly outperformed the broader market stallwarts.
Of course, 2019 isn't quite over just yet, but these uber performers are still worth noting, as trading volume winds down and the holidays, plus 2020, loom.
h2 1. Snap: +174% so far in 2019/h2The parent company of social media messaging app Snapchat, Snap (NYSE:SNAP) has made an impressive comeback following its tumultuous stock market debut in March 2017. Many traders wrote off the name because of its awful performance in 2018, when it lost 62% of value.
The company's comeback during 2019 is perhaps even more astonishing.
The social media company, once considered by many to be dead in the water, has turned in a series of earnings reports that have beaten forecasts in each quarter this year. The platform has enjoyed a resurgence in user growth, with daily active users (DAUs) rising to an all-time high of 210 million in the third quarter.
The company’s monthly active user (MAU) base is just above 500 million. Twitter (NYSE:TWTR), in comparison, has around 335 million users. Additionally, Snap’s overall average revenue per user (ARPU) grew 33% to $2.12 in Q3, indicating that the firm has improved its ability to further monetize its user base.
Shares of Snap have rallied a whopping 174% year-to-date (YTD), significantly outperforming the S&P 500, as well as social media rivals Facebook, +51%, and Twitter, +7%. The stock closed at $15.10 on Tuesday, giving it a market cap of $21.1 billion. Snap's share price touched an all-time low of $4.82 in December 2018.
h2 2. Chipotle: +92% so far in 2019/h2With its share price nearly doubling this year, Chipotle Mexican Grill (NYSE:CMG) has been the top restaurant performer of 2019. Plus, this occurred even as the industry has faced pressure from increasing competition.
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Shares of the burrito chain are up an incredible 92% since the start of the year as investors rewarded the company’s efforts to win back customers it lost to a food safety scandal in 2015. The stock ended at $832.05 yesterday, giving it a market cap of $23.1 billion. It hit an all-time high of $857.90 on Sept. 9.
Chipotle surprised on earnings for all four periods of the year, as Chief Executive Officer Brian Niccol’s mobile ordering options and promotion strategies helped the global eatery chain emerge from the shadow of a series of food safety scares that plagued it over three years ago. The Newport Beach, California-based company posted its highest sales growth at established restaurants in more than two years in the second quarter, driven by Niccol’s decision to focus on food delivery and partner with services Doordash and Postmates.
Niccol, the former head of Taco Bell who was brought on board in February 2018, also ramped up advertising highlighting the freshness of the ingredients the chain uses in its tacos and burritos as well as the addition of healthier meal options. Furthermore, online-only choices such as “Lifestyle Bowls,” healthier meals that include paleo, keto and vegan salads, also pulled in more customers.
h2 3. Okta: +80% so far in 2019/h2Okta (NASDAQ:OKTA) is one of the fastest-growing companies in the booming, cloud-based software-as-a-service (SaaS) sector. The San Francisco-based cybersecurity firm managed to avoid the downturn that hit the rest of the group midway through the year, going on to nearly double in price.
Shares have soared 80% in 2019, thanks to strong demand from large enterprises for the company's cloud-based identity and access management software. The stock settled at $114.10 last night, valuing the company at around $13.8 billion.
Its Q3 results, released on Dec. 5, came in better than expected, with earnings and revenue both topping analyst estimates. Customers with annual contracts valued at above $100,000 jumped 41% in its fiscal third quarter to 1,325, up from 937 in the same period a year earlier. Additionally, subscription revenue grew 48% Y-o-Y to $144.5 million, while billings, a sales growth metric, surged 42% to $175.6 million.
Looking ahead, Okta boosted its outlook for next year, indicating the company’s explosive growth is far from over. It now expects fiscal 2020 revenue to be between $574 million and $575 million, representing 44% Y-o-Y growth. Previously, management had expected full-year revenue to rise between 40% and 41% Y-o-Y.
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