In 1999, teenage girls swooned over the Backstreet Boys and NSYNC, the Yankees prepared to nab their 25th World Series title in October, and computer programmers worked late night after late night to ensure against a global "Y2K" crash. Meanwhile, in the fictional world, our hypothetical investor had a portfolio worth $6,532 after purchasing the top-two stocks of 1997 and 1998 -- Yahoo! (NASDAQ: YHOO) and Amazon.com (AMZN), respectively. Using this modest sum, our investor purchased 1,991 shares of Qualcomm (NASDAQ: QCOM), trading at $3.28 at the beginning of 1999. The wireless telecommunications firm had been available for public trading since the early 1990s but had been lacking in vigor. Even the 1997 purchase of the naming rights for the home of the San Diego Chargers did little to cheer the shares. In fact, looking back at a monthly chart, there would be no way to realistically predict that QCOM shares would go on to become the top stock of that very lucrative bull-market year.
And did they ever. During the next 12 months, Qualcomm shares zoomed up to $88.06, an increase of 2587%. Looking back, this would become not only the top stock of 1999, but of the entire 10-year period between 1997 and 2006. The beginning portfolio balance of $6,532 had surged to $175,327 by the time the world rang in the year 2000. Not bad from just $100 in January 1997.
Next: Step 4: LabCorp. of America (LH), 2000
Beth Gaston Moon is an analyst at Schaeffer's Investment Research.
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Reader Comments (Page 1 of 1)
8-30-2007 @ 8:15AM
Virginia said...
YOU KNOW IT IS EASY TO SAY $100 TO $1,000,000,000,00 BUT IT TAKES BIG MONEY TO MAKE BIG MONEY!!!
8-30-2007 @ 10:17AM
enjr01 said...
Qualcomm was a big winner; we hung in there and lost most of the $$ when it totally fell a part. So your stats sound great, a real dream maker, but it did not happen for us, sad to say.
8-30-2007 @ 3:03PM
Laura said...
aahhh i LOVE the Backstreet Boys :)
9-01-2007 @ 12:16PM
Bruce Bullock said...
As of 2007, what would the value of your portfolio be if you had held on to the Yahoo stock and taken advantage of the rise in price, stock splits,and dividens?