If you had invested all your money in Charlotte-area companies’ stocks, you would’ve done pretty well in 2016.
That’s not a strategy any rational investor would likely use. But the rising share prices of a cross-section of large companies based in and around Charlotte offer a window into how well a broad swath of the market did in 2016: Companies from financial to energy to manufacturing to quick-service restaurants saw their shares soar, boosting many investors’ portfolios.
The stocks of 20 of 25 major Charlotte-area companies climbed in 2016, some of them sharply. Bank of America, the largest company in North Carolina, jumped almost 31 percent as interest rates started to rise, the bank trimmed jobs and investors anticipated easing financial regulations under the administration of President-elect Donald Trump.
Shares of Charlotte-based steelmaker Nucor shot up 51 percent, in part thanks to the president-elect’s plans to increase spending on domestic infrastructure, such as road and bridge repairs. Former Nucor CEO Dan DiMicco, named a trade adviser to Trump, has been critical of trade agreements like NAFTA, which he blames for the loss of millions of American manufacturing jobs. Experts say the Trump administration could usher in more protectionist measures that bolster American-made steel against imports.
Southern fast-food favorite Bojangles’ perked up almost 20 percent, while snack-maker Snyder’s-Lance tacked on 12 percent.
Others didn’t fare as well. Lowe’s Cos. suffered, as did the rest of the retail industry has suffered. The home improvement company’s shares dipped more than 6 percent as earnings slumped and Lowe’s lowered its full-year expectations. Speedway Motorsports, which operates NASCAR racetracks, saw its shares squeak up 4 percent, amid the sport’s continued struggles to lure and keep fans.
Stocks nationwide surged towards the end of the year, driven higher by a combination of a strengthening economy with lower unemployment and higher wages, and anticipation that the incoming Trump administration will loosen regulations and slash corporate taxes. Both the S&P 500 and Dow Jones Industrial Average have hit new record highs.
“Overall it was a good year. We are up a very respectable 11.01 percent,” said Howard Silverblatt, an S&P Dow Jones Indices senior index analyst. “And remember, this wasn’t supposed to be a good year. The Fed had just increased (interest rates) last December.”
The S&P 500 rose more than 10 percent through Thursday, 2,249 points. The Dow Jones average jumped almost 14 percent year-to-date, to close at 19,819 points on Thursday – near a record 20,000.
Silverblatt cited Trump’s plan to chip away at the Dodd-Frank financial reform law as potentially beneficial for banks such as Charlotte-based Bank of America and Wells Fargo, which has its largest employee base in Charlotte.
“Things may get better. But at a minimum, things will not get worse for them – at least they’re not perceived to get worse,” Silverblatt said.
Investor Steve Eisman, who made his reputation betting against subprime mortgages and was played by Steve Carell in “The Big Short,” predicted a “golden age of investing in financial stocks” starting in 2017.
“The financial system is going to be at least partially deregulated,” said Eisman in a CNBC interview.
Judson Gee, Charlotte-based managing partner at JHG Financial, said that while infrastructure spending and deregulation could boost many companies, there are still “lots of question marks” for the coming year. He’ll be keeping an eye on potential trade wars – which could hurt export-focused companies – and the potential for increased volatility later in the year.
“We’re long in the tooth on this expansion,” said Gee.
Wrapping up 2016
Here’s how the stocks of the 25 largest publicly traded companies based in the Charlotte region fared this year through Dec. 30:
▪ Bank of America
+30.72 percent $22
▪ Lowe’s Cos.
-6.18 percent $71.34
▪ Duke Energy
+9.3 percent $78.02
▪ Babcock & Wilcox Enterprises
-20.27 percent $16.64
▪ SPX Flow
+15.84 percent $32.33
+51.19 percent $60.93
▪ Carlisle Companies*
+24.43 percent $110.36
*Carlisle relocated its headquarters to Phoenix midway through the year
▪ Sealed Air
+2.04 percent $45.51
▪ Coca-Cola Bottling Company Consolidated
-1.9 percent $179.05
▪ Premier Inc.
-13.72 percent $30.43
+6.98 percent $39.53
+47.26 percent $36.96
▪ Extended Stay America
+1.57 percent $16.15
+44.48 percent $98.97
-17..82 percent $30.26
▪ Sonic Automotive
+1.71 percent $23.15
+155.3 percent $23.82
▪ EnPro Industries
+56.25 percent $68.50
▪ Speedway Motorsports
+4.05 percent $21.56
▪ FairPoint Communications*
+16.68 percent $18.75
*Consolidated Communications announced plans to acquire FairPoint in December.
+11.98 percent $38.41
+12.34 percent $100.30
▪ 3D Systems
+53.97 percent $13.38
+19.72 percent $19
+36.7 percent $75.57
Officially based in Ireland, Ingersoll-Rand maintains offices and its top executives in Davidson.