Monday, January 03, 2011

Rural stock picks do very well in 2010

The Daily Yonder 40 -- forty stocks picked to reflect the rural economy -- had a very good year. Make that a very, very good year. The selection of stocks rose 31.4% this year, a gain that swamped all the major stock indexes, according to Bill Bishop, James Branscom and John Borden of the Daily Yonder. In 2010, the Dow Industrials rose 11%,  the S&P 500 rose 12.8% and the NASDAQ rose 16.9%. Not even close to the Daily Yonder 40.

Among the strongest performers was Tractor Supply, the retailer that sells rural America "the stuff you need out here." Tractor's good fortune just may reflect the extremely strong farm economy, which had land and crop prices rising, according to Bishop, Branscom and Borden. Tractor Supply was up 83.1%. Other winners: Grand Old Opry owner Gaylord Entertainment rose 82% this year. Family Dollar was up 78.6%; Sturm Ruger, up 57.6%; Cabela's, up 52.5%.

Nine stocks were losers: Dean Foods ("milk is still oversupplied"), Monsanto ("under antitrust scrutiny by the Department of Justice"), Alico, ConAgra, International Speedway ("people continued to stay away from NASCAR"), Plum Creek Timber, Penn Virginia, Skywest and Universal Corp. 

As for next year, companies interested in clean energy should be successful, food companies have vowed to increase their prices, equipment sales continue to look strong, and the Northwest is increasing its exports of wood products to China. (For a full list of the stocks and to read more)

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