Wednesday, July 18, 2007

Top 25 Should've Bought

A $100 investment in each of these in their infancy would have turned $2,500 into $650,000. Of course that would have meant being wise enough to recognize the vision of Microsoft's Bill Gates and Oracle's Larry Ellison; the promise of products such as motorcycles and pork; and the big profits in money management.

1 Franklin Resources 64,224%

As the old saying goes, the way to make money during a gold rush is to be the one selling shovels. The best stock of the past 25 years – the USA's No. 4 mutual fund manager – is a prime example, managing money and dispensing investment advice during a 20-year bull market.

2 Danaher 47,913%

Most people might never have heard of this maker of industrial measuring tools, but companies of all types depend on its gear, which measures just about anything, ranging from electricity to blood and air quality.

3 Eaton Vance 38,444%

This smaller rival to Franklin Resources also cashed in on the insatiable demand for money management as it offered everything from mutual funds to services for institutional investors.

4 UnitedHealth 37,672%

Skyrocketing medical costs often are the worst part of going to the doctor. This insurer has prospered as employers and consumers looking for protection from wallet-busting costs snapped up its plans.

By Justin Sullivan, Getty Images

5 Cisco Systems 33,632%

This router maker made a fortune selling fatter straws to Internet surfers sucking ever-bigger amounts of bytes by downloading music and updating their Web pages.

6 International Gaming Technology 33,436%

Investors who bet the house on this slot machine ace hit jackpot. It makes one-armed bandits such as "Megabucks" and "Wheel of Fortune" and cashed in on casino and online gambling craze.

7 Biomet 30,531%

Biomet's reconstructive medical devices have made breaking a knee, leg or shoulder a bit less scary. Its success also made Biomet part of another huge trend: Private-equity investors are buying it.

AP photo

8 Microsoft 29,266%

More than 90% of computers run some sort of software from the house Bill Gates built. Pen and paper are foreign objects to cubicle dwellers nowadays thanks to its ubiquitous Windows operating system and Office software tools.

9 Best Buy28,703%

This retailer turned itself into a Disneyland for gadget freaks with its shelves brimming with the latest electronic gizmos. Anyone itching for a bigger TV or faster computer knows right where to go.

By Justin Sullivan, Getty Images

10 Oracle28,535%

Companies not willing to lose their institutional memory count on Oracle databases to store their most vital information. The company Larry Ellison heads offers software to manage all corporate data.

11 Stryker 25,383%

Weekend warriors don't have to hang up their cleats, skis or racquets due to wobbly knees or worn-out hips. Stryker's artificial joints help keep 77 million Baby Boomers in the game.

12 Countrywide 24,160%

This leading mortgage lender provided the fuel for the home-buying boom, which in turn was a boon for its bottom line. Its focus on first-time buyers with pristine credit has limited collateral damage from exposure to sub-prime lending.

13 Expeditors International23,860%

If it seems most everything sold here was made in China, this freight-forwarding company is probably partly responsible. It helps exporters save money by selling empty space in transport vessels.

By H. Darr Beiser, USA TODAY

14 Home Depot 23,845%

Handy types willing to strap on a tool belt and silence that leaky faucet, feel at home at this arms dealer in the do-it-yourself craze. It puts cut-rate prices on everything from screws to toilets.

15 Dell 23,048%

A revolutionary made-to-order PC business model that was the brainchild of founder Michael Dell wowed Wall Street. Ads like "Dude, you're gettin' a Dell" helped transform it into a USA icon.

16 Robert Half 21,170%

This is a case of putting the right people in the right place at the right time. The provider of temporary and permanent help's deep bench of accounting and financial pros ready for hire helped it prosper in the post-Enron world.

17 Credo Petroleum 20,180%

This pint-sized natural gas driller produced huge returns because its patented technology "liberates gas stranded in reservoirs."

18 Adobe Systems 19,989%

Anyone who has opened a PDF file knows what this digital-imaging king makes. Its flagship Photoshop software lets consumers and pros doctor photos while its Flash Web software turns Web pages into animated spectacles.

19 Precision Castparts 19,437%

Another stellar stock many have probably never heard of. It makes investment castings and airfoil castings and other components used in jet engines.

By Seth Wenig, AP

20 Berkshire Hathaway 19,424%

Warren Buffett, the "Oracle of Omaha," made himself and shareholders rich investing in easy-to-understand, undervalued businesses. Paint, underwear and insurance may not be sexy, but they're profitable.

21 Smithfield Foods 19,414%

Pork production and processing added up to super-sized gain for Smithfield and put its shareholders in hog heaven. Its pre-processed sandwich meats fill kids' lunchboxes daily, and the low-carb craze make Smithfield bacon a breakfast staple.

22 Paxar 18,923%

If you've ever bought a pair of jeans, capri pants or trendy piece of apparel, you know Paxar. They make info-packed labels, tags and pressure-sensitive stickers that list fabric, size, price and advise on after-purchase care.

23 Time Warner 18,158%

This media and entertainment mega-giant is home to brand-name magazines such as Time, People, Money and Sports Illustrated; cable behemoths CNN and HBO; movie studios Warner Bros. and New Line Cinema; and AOL.

24 Paychex 17,920%

On payday, Paychex does everything for small business except writing the checks. It calculates timesheets, processes payroll, prints pay stubs, deducts taxes and sets up direct deposits.

By Tony Dejak, AP

25 Harley Davidson 17,808%

Legions of loyal followers are devoted to the USA motorcycle maker whose chrome-accented cruisers are affectionately dubbed "Hogs." Buying a "Roadster" or "Softail" is part sport, part $8,000-to-$21,000 personal statement.

Source: Ned Davis Research. Performance is through 4/5/2007 from 9/15/1982. Performance for stocks that went public after 9/15/1982 is from each company's split-adjusted initial public offering price.