Two years ago today, the Daily Yonder began tracking the stock prices of 40 diverse, publicly traded companies that do much of their business in rural America. The record shows that the "Yonder 40," as it is called, was doing better just before the economic downturn and is coming out of it more quickly. (Yonder chart)"The Yonder 40 stock index has lost 27 percent of its value since July 1, 2007," Co-Editor Bill Bishop reports. "The Dow [Jones] Industrials — 30 of the nation’s largest corporations — have lost 37 percent. And the S&P 500 — a broader index of large companies — has lost 39 percent. The only common index that comes close to the Yonder 40’s performance has been the NASDAQ listing of smaller firms. The NADAQ has lost 29.5 percent in the last two years."
Bishop adds, "The Yonder 40 was an experiment of sorts, so it is not exactly clear why these rural stocks are doing better than the broader stock indices. In much of mid-America, unemployment rates have been lower than in the rest of the country, especially in agricultural counties. However, rural manufacturing has been particularly harmed during the recession and unemployment in these counties is running well above the rest of the country."
The story mentions several individual companies, including those that have been dropped from the index for various reasons. One is newspaper publisher Lee Enterprises, which was dropped "because its stock prices dropped so low the company was in danger of being delisted by the New York Stock Exchange," Bishop reports. "It is now trading for considerably less than a dollar," after starting the index at $21. The best performer has been coal producer Walter Energy, "up 25 percent from July 1, 2007, even though it has taken a huge tumble from its highs." The best so far this year has been Cabela's, the chain of huge sporting-goods stores. It's up 107 percent since Jan. 1, to $12.30 a share on June 30.
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