Three gems of 2017 that are set to shine on in 2018

These stocks all gained more than 50% last year, yet they continue to trade below or near their fair value estimates.

Vikram Barhat 17 January, 2018 | 6:00PM

It was yet another year of spectacular gains for the North American stock markets in 2017. And if the initial days of 2018 are any indication, the equities party is likely to continue at least in the foreseeable part of this year.

While the S&P 500 returned more than 20% in a year of records, these hefty gains for the benchmark pale in comparison to the year's best performing stocks. At the top end of the performance pole are companies whose stocks gained more than 50%, a few of them racking up triple-digit returns for the year.

Often, the flip side of such remarkable performance is stretched valuations, which is indeed true of many companies in this exclusive group. However, despite delivering outsized gains, select stocks are still trading well under or close to their fair value. These companies have strong fundamentals and are poised for long-term growth as a tailwind of conspiring factors, including strong economic growth, improving corporate profits and the expectation of favourable tax and fiscal policies under Trump administration, continue to push them higher.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Adobe Inc357.41 USD-4.17
The Estee Lauder Companies Inc Class A198.78 USD-5.01
Vertex Pharmaceuticals Inc237.01 USD-3.77

About Author

Vikram Barhat

Vikram Barhat  Vikram Barhat is a freelance writer.