The stock market has rebounded sharply since its downturn at the end of 2015. Let’s take a look at the biggest gainers of this summer. Every stock on this list has gained at least 25% over the past quarter and is currently listed on the Standard & Poor's 500.
Note: Return numbers calculated at close on Sept. 9.
13. Best Buy – 25.24%
Best Buy (BBY, Financial) reaches across six different categories for its revenue. Not only is it a leader in consumer electronics, but it has established business in computing and mobile phones, entertainment, appliances and services. Its last segment is named other and includes snacks.
Looking forward, the company aims to expand through multiple channels thus reinforcing its market power. Best Buy also is planning on reducing costs through fiscal 2017.
The stock has had a particularly strong summer, posting a 25.24% return over the last three months. Much of its price appreciation occurred in late August when strong financial results spurred optimism.
Reports released about both earnings and revenue beats against projections catapulted the stock 11% at one time. The great momentum continued after a strong second half was anticipated.
12. Kinder Morgan – 27.11%
Kinder Morgan (KMI, Financial), with its market capitalization of $48 billion and revenue of $13 billion, is North America’s biggest energy infrastructure company. It has major holdings of pipelines and terminals. It transports multiple energy sources such as natural gas, crude oil and more.
Kinder Morgan is split into six revenue segments. The Natural Gas Pipelines segment operates pipelines, facilities and storage systems. The CO2 segment deals with the entire life cycle of CO2 for oil fields. The Terminals segment has a vast number of facilities throughout the U.S.
Products Pipelines also operates pipelines for various energy sources, and the Kinder Morgan segment operates pipelines through Canada. The Other segment encompasses the rest of the company’s revenue.
Over the past three months, shareholders of Kinder Morgan have been rewarded with a 27.11% gain. Kinder Morgan has not had a significantly large up day in the last three months but has instead been consistently and slowly growing since the beginning of the year.
11. Nordstrom –Â 28.74%
Nordstrom (JWN, Financial) is a popular retailer that prides itself as a leader in fashion specialty. Like most retail businesses, the company’s sales are extremely seasonal and much of its profit relies on fourth-quarter holiday shopping.
Nordstrom is comprised of two revenue segments: retail and credit. Its retail segment is diversified into several revenue channels. Its private label inventory is characterized by high-quality materials and a focus on a customer’s experience.
Nordstrom also has store-branded debit cards and credit cards. Both of these cards come with a loyalty program that is designed to increase repeat business. The credit segment of Nordstrom helps to not only increase sales but also collect revenue from credit card fees and interest.
Over the past three months, Nordstrom has returned 28.74% to shareholders. A revenue miss in August was overshadowed by better-than-expected earnings and pushing the stock 11.4% higher. Several days later, UBS assigned Nordstrom a buy rating that continued to help the stock up.
10. NVIDIAÂ – 29.07%
NVIDIA (NVDA, Financial) focuses on visual computing as it relates to Gaming, Professional Visualization, Datacenter and Automotive. The company’s main products each serve those particular markets. GeForce is aimed for gaming, Quadro is used for professional visualization, and GRID is for datacenter.
The rising popularity of video game sports, also called eSports, and the increasing hype for the upcoming virtual reality technology has only helped the already widely popular computer gaming industry. Even without those contributions, computer gaming is already one of the largest entertainment industries.
NVIDIA saw shares increase by 29.07% over the previous quarter. It has risen with the semiconductor stocks as technology companies like Adavanced Micro Devices (AMD) have grown at a high clip over the past year.
Gains of 24% in revenue year over year in the second quarter led to high praise from analysts and an upgrade from Morgan Stanley (MS) and Deutsche Bank (DB). These raised price targets and upgrades pushed the stock 4.4% on Aug. 12.
9. Spectra Energy – 29.59%
Spectra Energy (SE, Financial) is a player in the natural gas space and leader in natural gas infrastructure. It is involved in the whole process from gathering to distribution. The industry is separated by name into three distinct parts, including gathering and processing, transmission and storage, and distribution.
Spectra holds multiple types of assets to support their operations. Massive facilities support high capacities along with extensive pipelines for both natural gas and crude oil. In addition to their over 20,000 miles of pipelines for natural gas transmission, the company has a 50% interest in a major natural gas gatherer and vast partnerships through their MLP.
Spectra Energy has increased by 29.59% the past three months. The major event that affected this company the most over the summer was an agreement for Enbridge to acquire Spectra. The acquisition will create the biggest energy infrastructure business in North America.
The Enbridge Spectra deal is being praised for its simplicity and natural fit between the two companies. Not many of the affected operations are expected to overlap.
8. eBay Inc. – 32.49%
EBay (EBAY, Financial) is a popular website that allows buyers and sellers to transact in a safe and reliable way through the Internet. It has been one of the leaders in global commerce since its initial public offering in 1998.
EBay prides itself on its accessibility for customers no matter where they are, 24 hours a day. The company’s vast variety in online inventory is spurred by its many sales outside the U.S., which surpass the amount of business done domestically.
EBay has been a great choice for shareholders lately, earning them 32.49% over the past quarter. After generally underwhelming stock price performance from October of last year to the end of June, the stock took off at the beginning of July.
The company had a great second quarter report. Among its many accolades and improvements, the company was able to increase revenue 5.7% year over year. This led to an 11.7% increase in stock price and really helped drive the rest of its gains.
7. Urban Outfitters – 37.08%
Urban Outfitters (URBN, Financial) is a popular retail operation that specializes in brands that appeal to the trendy hipster fashion. The company really emphasizes the importance of creating an emotional relationship with the customer.
Urban Outfitters is trying to broaden its options past the conventional brick-and-mortar model and into Internet sales through its ecommerce sites and apps.
Higher-priced merchandise has helped the stock’s margins, and the company has been able to grow revenue by an average of 9% for five straight years. Urban Outfitters has recently joined the political discussion by selling several “anti-Trump” shirts in its stores.
Urban Outfitters has created a favorable relationship with shareholders lately, resulting in a 37.08% gain. Strong sales reports in June from many major retail stores pushed the industry higher after a period of uncertainty.
A great second quarter report beating both EPS and revenue estimates sent the stock price 9% higher on Aug. 16 and 12.36% higher on Aug. 17.
6. Micron Technology – 38.47%
Micron (MU, Financial) is a global leading provider of semiconductor systems. Its impressive product portfolio features advanced technology in memory, storage, computing, mobile, networks and more. Micron’s biggest customers are original equipment manufacturers and retailers.
Micron partners with Intel (INTC) for various flash and memory products and with Nanya Technology Corporation for DRAMs. The company also has manufacturing facilities worldwide which required significant capital to establish.
Micron's share price has grown by 38.47% over the past three months. This was after the difficult beginning months of the year when the stock fell from $18 to $10 in the course of months.
Micron’s push for shareholders rights brought the stock 5.4% higher at the end of July. Major gains in other semiconductor stocks also raised the tide for Micron along the way. An admission of shortages on memory by HP’s CEO lifted the stock by 6%.
5. NetApp – 40.98%
NetApp (NTAP, Financial) is an IT company that uses its products and services to help its clients manage data and create an IT environment. Some of its established clients include government organizations, service providers, enterprises and partners.
The company has a strategy to incorporate all of the data from the various cloud providers into a digestible solution for IT systems called the Data Fabric strategy. NetApp puts a primary focus on addressing customer needs by increasing their efficiency and ability to grow.
The past three months have been great for NetApp shareholders, as they’ve seen the value of their shares increase by 40.98%. Like many of the companies on this list, NetApp had a great earnings report in August. Shares soared 7% after reports of a $30 million revenue beat and 10 cents EPS beat.
On the heels of posting great numbers, NetApp also provided optimistic estimates for the future. This helped the stock rise 4% more. The great price trend continued with another 9% gain on Aug. 18.
4. Williams Companies – 41.40%
Williams' (WMB, Financial) primary function is to take the natural gas, NGLs and olefins markets and connect them to resource plays across North America. The company does energy infrastructure and is segmented into several different businesses.
The Williams Partners segment is a master limited partnership with assets in gathering, production and transportation. They have many pipelines and midstream projects in natural gas, NGLs and olefins. Williams NGL & Petchem Services includes liquid extraction and propane dehyrdogenation. The final segment is called other and deals with a construction company and corporate.
Williams has been able to grow by 41.40% throughout the summer months. News of demand for the selling of its unit in Canada propelled shares by 5.6% on July 14.
Later, an announcement of a dividend cut to focus on a pipeline operation helped the stock up another 4.1%. The price momentum continued when rumors of an acquisition by Enterprise Products rewarded shareholders with an over 6% increase in share price.
3. Symantec – 42.03%
Symantec (SYMC, Financial) is a bodyguard to the Internet. It has a massive database that it uses to identify and extinguish threats from servers, mobile devices and endpoints. Symantec supports customers with its global security centers and personalized service from cyberspace security experts.
Moving forward, Symantec completed the sale of its Veritas business to focus on costs and favorable capital allocation for shareholders. The deal to break apart from Veritas’ information management business netted the company over $6 billion in cash.
Symantec has returned an impressive 42.03% performance for shareholders this quarter. A new CEO helped buoy the stock 4.5% in part because of the perceived faults of previous management.
The company was then able to capitalize on great quarterly results to careen the stock up 6%. Symantec was able to outperform expectations on both revenue and earnings per share. The stock is now reinforced by positive outlooks from Citigroup (C), Morgan Stanley and Goldman Sachs (GS).
2. Seagate Technology – 55.96%
Seagate (STX, Financial) has a vast portfolio of products to serve the memory storage market. It sells HDDs (hard drives), SSDs (solid state drives), SSHD (solid state hybrid drives) and more. Not only do these products end up as external storage devices, but they also are found to store memory in DVRs and surveillance systems.
Much of its revenue comes from purchase agreements with OEMs (original equipment manufacturers), a full 70%. The rest of the revenue is generated through distributors at 16% and through the retail channel at 14%. Over 54% of Seagate’s revenue comes from Asia.
With a great recent surge, Seagate's share price has compounded by 55.96% over the past three months. The company had a great fourth quarter report, when it beat revenue estimates by $20 million and EPS estimates by 9 cents. This helped push the stock 5% in one day and see further gains later on.
It was actually the anticipation of a great earnings report before the actual release that sent the stock flying above double digits on multiple days. An announcement of a significant 14% reduction in workforce prompted a Morgan Stanley upgrade and was another catalyst sending shares up.
1. Chesapeake Energy – 72.40%
Chesapeake (CHK) produces natural gas and (NGL) oil and natural gas liquids. As the United State’s second largest producer, Chesapeake has wide range of assets to serve the industry. It has positions in the booming Eagle Ford Shale among many of its widespread geographical areas.
For the upcoming fiscal year, the company is ramping down the number of rigs they will operate compared to 2015. This will assist in their goal of increasing margins and liquidity. To additionally raise the value of existing assets, Chesapeake will add crews specializing in completion.
This past summer has been characterized by a wide range of volatility in Chesapeake’s stock. Shareholders are particularly happy with recent developments leading up to a 72.40% increase in this short period of time.
News of Chesapeake leaving the Barnett shale propelled the stock 5.2% on Aug. 10. A subsequent plan for a $1 billion loan to buy senior notes helped the stock climb some more, resulting in a 16% increase over two days.
The company soared 13.5% on Thursday after a successful company presentation at the Barclays CEO Energy Power Conference signaled optimism surrounding the stock’s financials.
Future outlook
Of all of the companies on this list, Best Buy features the most attractive valuations and stout financial condition to continue its hot streak into the foreseeable future.
Best Buy’s low price-earnings ratio (P/E) of 14.4 and high dividend yield of 3.88% coupled with a Value Trap Indicator score of 214 make it a Strong Buy at current price point.
Another company on this list with great financials is Micron Technology. It has a great combination of low P/E at 6.8, low price-book ratio (P/B) at 1.5 and absurdly low price-sales (P/S) at 0.3. That low P/S tells us the company is generating plenty of revenue and is a steal at current prices.
Since the Value Trap Indicator filters out stocks that don’t pay a dividend, Micron scores a 343 which is just out of reach of “buy” territory. However, if you are an investor who doesn’t seek dividends, MU scores a VTI of 109 (Strong Buy) if you exclude the dividend category.
To download a spreadsheet with the Value Trap Indicator scores of every company on this list, subscribe to the author’s email list.
Disclosure: The author doesn't hold any of the securities listed.
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