Ask the Expert: Killer Returns vs. Killer Stocks

Killer StocksQ: What exactly is meant by "best-performing stock"?

A: A best-performing stock is the one that has delivered the highest total return to shareholders over a set period of time. For example, online travel booking Priceline.com (PCLN) is the best-performing stock among the S&P 500 over the past year, up a whopping 195%.

Optimists will say that a stock ranks among the top performers because the business is firing on all cylinders. Sales are up, so are profits, and the future looks bright. In Priceline.com's case, sales are up 35% over the past year, its international business is booming, and all signs point to the company having a long growth runway ahead.

A more glass-is-half-empty perspective, though, is that a stock usually has to start out down in the dumps in the first place in order to score such a big turnaround.

For example, the best-performing stocks coming out of the financial crisis in March 2009 were banks, which were among the worst-performing stocks over the previous year. In that sense, nabbing best-performing stock honors is less like winning Most Valuable Player and more like being voted Most Improved. And, sure enough, Priceline.com's stock had stumbled in spring 2010, setting the stage for an even greater recovery.

Be sure to dig into the story behind the soaring stock charts before buying shares. While the stock's killer performance might be because the business is kicking butt and taking names, there's also a chance Mr. Market has gotten ahead of himself and assigned too high a value to the shares.

The bottom line: If you're confident in the company's fundamentals and long-term prospects, biting the bullet and buying shares of a rising business could make sense even if the stock is already off to the races. If you're a cheapskate with a contrarian bent like me, though, you might want to wait until the stock cools off a bit before starting to nibble. Patience pays.

Joe Magyer is a senior analyst at The Motley Fool. He enjoys mint juleps and self-referential humor.

Learn about investing from the comfort of your own home.

Portfolio Basics

Take the first steps to building your portfolio.

View Course »

Investment Strategies

Learn the strategies you need to build a winning portfolio

View Course »

Add a Comment

*0 / 3000 Character Maximum

17 Comments

Filter by:
mmcdonald2k

Register to win a free copy of Eye In The Sky Screener. A winner will be announced on the first day of each month. It is the screener professional traders rely on.

Visit www.eyeintheskyscreener.com to register for your free copy today. Simply click the "Request Your Free Copy" button to enter.

"Trading Information @ Your Fingertips!"
Michael McDonald

July 23 2011 at 12:18 AM Report abuse rate up rate down Reply
Brickhead

The Red Plague & wall Alley PIGGS sell their wives and daughters for
Neanderthals like Arnolds mistress.
Honestly, how many bottles of Satans’ spew
did the Red PIGG Arnold need to down before pumping that bitch.
But of course both the Wall Alley PIGG and Red Plague are not only clueless but classless.

July 11 2011 at 10:50 AM Report abuse rate up rate down Reply
Brickhead

Overdue For a Correction
That is.
Not our markets.
It’s the wall alley pigletts & Red Plague dUE for a CORRECTION and correctional facility;
and like no facility on this EARth
Yes Indeed.
Pursuit of EVIL Man in 2011, 201x, 201 & u will c what it brings u.
Storms RIP thru America.
EVIL begets EVIL in 2011, 201x, 201
What is an insider?
Werare333 and weareinsiders.
Yes. A pre press, pre printed release details wall alley & Red Plague PIGG daarck path.
U r on WANTED posters in Christ Kingdom baaaad piglets.
Satan conjures THE WORLD and Puts parts IN Place and takes Bounties ON ALL that CALL.

July 11 2011 at 10:49 AM Report abuse rate up rate down Reply
Brickhead

The Wall Alley Federal Reserve PIGGS Market.
Again Middle America, LIES from the PIGGS OF THE WORLD.
The PIGGS CONTINUE TO SHORT AMERICAN PORTFOLIOS.
The Latest LIES – SLOWDOWN FROM THE PIGGS. More Overseas....................BS
Satan Flies High OVER U WALL ALLEY PIGGS.
Satan COVERS Montana & U FOR YOUR MIS DEEDS PIGGS.
Satan CONJURES HIS PIGGS

July 11 2011 at 10:48 AM Report abuse rate up rate down Reply
Brickhead

Is It GLOOMy when U walk into your work space everyday Red Plague & Wall alley PIGGs?
dO U fEel like U R b ing watched or disliked?
Upset tummy.
iS ******** with your goat now a bummer?
Does iT nO lOnger feel like a Place of fun?
Perhaps feeling suicidal. Suicidal. Suicidal.
Well Then.
We Have a BIG Surprise 4 U.
Satan BRInGs U Fun. Much Fun. Your day will be brightened.
U desire to MESS with Kingdom of Christ PIGGS?
Not smart. EVIL Man does NOT go too far.
Prepare for the winds of Daarckness that sweep away your souls.

July 11 2011 at 10:46 AM Report abuse rate up rate down Reply
Brickhead

Good Mourning Wall Alley PIGGS & Red Plague
How do U like being Satan’s number 1 evol ahead of all sevol.
Russia, China, Koranieville:
Do U like the way the suited Wall Alley PIGGS & Red Plague SHORT your stocks daily?
These are #1 PIGGs in suit of World along with BP & GS.
Like the wicked witch of the east said; I’m melting……melting.
Launch time. U-236
Wall Alley PIGG calls for Satan and the PIGGS shall have him.

July 11 2011 at 10:45 AM Report abuse rate up rate down Reply
Brickhead

Montana & Idaho PIGGS for Satan were marked by the Beast.
Tester, Simpson, Riche and Alaska Murkowski are ALL MARKED along WITH their bloodlines.
EVIL Man brings only EVIL to America in 2011, 201x, 201
America – Here are YOUR latest United States PIGS that were voted for and placed into office –
April 11, 2011 – US Congress – Washington – sneaks in legislature to Murder Americas & Christ Great America Gray Wolves & gets signed off with Satan under the Table –
500 were just MURDERED in the states of Idaho & Montana which led to the Gulf Catastrophe and now Satan comes back for more –
“This stealth attack on wolves -- which circumvents the will of the courts and good science -- was inserted by Representative Mike Simpson (R, ID) and Senator Jon Tester (D, MT). It was approved by the leadership of both the House and the Senate, and it was Okayed by the White House.”
“It is a shameful day for this nation when both parties unite behind the slaughter of an endangered species -- without public hearing or debate.”
AS WE ALL KNOW - THEY MASTURBATED EACH OTHER WITH THE LEFT HAND OF SATAN WHILE THE DEAL WAS CUT WITH MONETARY INCENTIVES UNDER THE TABLE.
America - Chase them OUT OF THE U.S. with the Legal NRA weapons like the BeASTS do cHRISTS animals and when they CRAWL UNDER A ROCK, GAS THEM OUT OF THEIR HOLE THE WAY THEY DO CHRIST's INFANT WOLVE PUPS.
– only Satan will play this card !! to murder OUR wolves
Because This time Satan TAKES MUCH MORE THAN THE United States GULF
THE failure for America & the world to heed the warnings of EVIL Man will bring the unseen HORRIFIC/Catastrophic events to the world that have been predicted and long long ago & America can join the British Pig BP. EVIL begets EVIL in 2011 & 2012 until ………..
And for a single 2 legged mis –creation that sees happiness in acts of sadism, YOU CAN BET THAT SATAN WILL WIPE THAT SMILE off and replace it with his anal serpentine trident through the mis-created face.
There are MANY Edgar Casey’s in America – 1000% correct

July 11 2011 at 10:44 AM Report abuse rate up rate down Reply
Brickhead

Daarckness

Daarckness sets upon the wall alley pigg.
Midnight is Daarck Knight.
There is NO the Street LIGHT.
Arrogance, spite, vindictiveness by PIGGS
Gets them a reward.
U call for the PIGG u shall have him.
Leasing of your wall alley space is no longer necessary PIGGS.
But why?
Because the space is now a part of empty space and Satan taunts his piglet MM’s and brokerages, before Barbecue Pork #1PIGGS get extra sauce and yeah tastes like chicken.
It’s right in the book, my little piglets. But can’t u see?
U cannot do better than this MM PIGGS? Chasing Americans portfolios gets U your reward.
Do U really think u can defeat the Kingdom of Christ – PIGGS?
We say Nay. Not in 2011, 201x, 201.
Satan shall feast on the “chartings” of his PIGGS and continue to inject the PIGGS life force a shorting potion, while he shoves upwards into the PIGGS, his anal serpentine trident as the PIGGS embrace orgasm & rejoice downing his spew.
Shake Buildings, Shake, Shake, Shake

July 11 2011 at 10:44 AM Report abuse rate up rate down Reply
Brickhead

And Now The Financial Wall Alley & Red Plague PIGGS
They Lay down to sleep,
As Satan SOARS around piglets feet,
And Tickle Tickle Tickle
They suck on Satans pickle
And swallow his spew down deep.

July 11 2011 at 10:43 AM Report abuse rate up rate down Reply
Brickhead

Rewards are coming Wall Alley PIGGS – Big Commissions $$$$$$$$$$$$$$$$$$$$$
The loss of a few dollars is nothing like the reward U will get Wall alley.
Christ walks far far away from the wall alley PIGG.
Your misdeeds upon America brings
Your reward for “members only trading” means U get the highest award.
Since U mark Good Man U get the Highest fliers;
satan & his Legion of DOOM.
And U see American PIGGS – this is just as unlikely to happen as 911, Phoenix sandstorm, Katrina, ripping tornadoes & storms across America, flooding, gulf catastrophe, Arizona on Fire, New Mexico on Fire, Montana wolve killers under siege of Satan ‘s bLOOD.
& you bethcha that those oil spills were caused by global warming or position of the milky weigh –
NOT
EVIL begets EVIL in 2011, 201x, 201. EVERYONE accountable.
Satan flies high in America with the Red Plague and Wall Alley PIGGS.
This is how EVIL Man is REWARDED in America in 2011, 201x, 201.
Sure U want to continue this Clint Eastwood muvee “For A few dollars more” Wall Alley PIGG?
ThIS sToRy Ends much different though Wall Alley PIGGS.
Satan conjures his Wall Alley PIGGS. Sometimes things take a little time but U call for him.
Just b at work. Be a Good employee. And DO NOT WONDER WHY when U get your reward as Satan continues compensation throughout the world and 2011, 201x, 201
Have a Wonderful Weekend

July 11 2011 at 10:43 AM Report abuse rate up rate down Reply