We spend a fair amount of time picking on the worst teaser picks made by newsletter publishers in their advertisements … particularly around Thanksgiving, when we highlight the Turkey of the Year for a bit of fun (and to help remind folks of how far story stocks can fall, regardless of the smooth words of the copywriters building a case for an investment) … so at the end of the year we like to remind you that yes, sometimes these folks pick some really good investments, too … even in their breathless and over-hyped ads.
Plus, this way you get to have something to read during the week between Christmas and New Year’s Day, when Stock Gumshoe HQ goes into hibernation mode and we recharge our batteries for what is sure to be an interesting 2013.
So what were the highlights of 2012? Here are the ones that caught our attention and performed very well over the past year — this is just counting how they would have done if you had bought them and held on for the rest of the year (in a couple cases other stocks have done far better but have come back down from their highs):
The 3D Printing Mania — The first newsletter to be really aggressive about this in their teaser ads was the Motley Fool Stock Advisor, presumably the Dave Gardner half of the Fool brother duo, back in March. Stratasys (SSYS) and 3D Systems (DDD) are both up more than 100% from there and lead the 2012 Stock Gumshoe Tracking Spreadsheet (all the past year’s spreadsheets are here, by the way).
Those two stocks, the leading makers of 3D “printing” machines, have done well for several other newsletters this year, too — the third best teaser pick of the year came from those same companies, when Michael Robinson touted DDD a couple months later to good end (he also picked the far riskier Organovo, which spiked incredibly, over 200% gains in just a month, but gave back all those gains almost immediately), and Nicholas Vardy also eked out a 50% gain in his tease of DDD so far … heck, I even featured them for the Irregulars over the Summer (though the shares are only up 65-70% since then).
Most years also bring a pick that spikes because of a takeover — and this year is no different, Louis Basenese teased Authentec (AUTH) back in July as a “safe penny stock” for WSD Insider at around $4.50, and it was taken over by Apple just a few months later at $8, giving a 77% gain and a virtual tie for fourth place on the spreadsheet.
The pick it tied with? You won’t be surprised to hear that the big gainers are dominated by technology and biotech companies this year — usually the big winners are in those volatile sectors, with a few miners thrown in if it was a good year for the junior explorers. This year the biotech pick in the top ten performers is Alnylam (ALNY), which was teased by the folks at Casey Extraordinary Technology back in May around $10, just a couple months before they released positive Phase 1 data that spiked the shares 50% or so in a single day. The other three picks teased in that same ad didn’t do as well, of course, but only one was a substantial loser (Curis), so the average for that teaser ad was pretty strong.
Next? Sixth place goes to a teaser that it seemed like everyone on earth must have seen at least a few times, Greg McCoach’s “Billion Dollar Mountain of Silver” — Tinka Resources (TK in Canada, TKRFF on the pink sheets), an absolutely teensy weensy stock both then and now … though it is now up by more than 60% since we covered the teaser in June so it makes the grade as one of the best performers of the year.
And we’re arbitrarily cutting this off at a 50% gain, so there’s only one more stock that makes the cut as of the time we pulled the numbers — that’s Sandstorm Gold (SAND), which was teased by Matt Badiali as a “Mainz Income” pick in late June when it was dipping a bit, down below $8 (split adjusted) … of course, to be fair he also recommended it back in April at about $9 as a “Secret Gold Society” pick, still profitable from that price but not as enticing. This has been a newsletter favorite since mid-2011, so other folks certainly recommended it at lower prices last year, and I personally have written about it probably far too many times as it’s also been one of my largest personal holdings for a couple years, but Badiali’s tease in June was certainly well-timed, before the big run-up to the NY listing.
This is the end of the year, the festive season, and a time of optimism for 2013 (I hope) … so we won’t harp too much on the fact that of about 200 teaser picks we’ve uncovered this year, most of which promised stupendous gains, only eight picks (a few of which are duplicates) are closing out 2012 with at least a 50% gain … and 16 are booking losses of more than 50%.
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There is, actually, some hope to be seen in the spreadsheets too — I think this is the first time (I’ve been tracking these since 2007) that as we approached the end of the year the median pick broke even, or close to it … we had about 100 stocks that went up of those teased, and 100 that went down. Typically, that’s been more like 60/40 or 70/30, and not in the good way.
Of course, that’s not particularly scientific or annualized, some of those picks are from January and some are from November (we haven’t added in the last six weeks or so yet, though they’ll be in the spreadsheet before too long as well) … and if you had just bought the S&P 500 a year ago you’d be up about 16% (not counting dividends), but still … maybe these teaser picks are getting a little bit better, particularly if we can all just get smart enough to avoid that handful of picks every year that loses 80 or 90%.
So that’s our note of optimism to close out 2012 … Happy New Year to one and all in Gumshoedom, and we’ll be back to sniff out the teasers, throw some reality on ’em, and hope that we find some winners in 2013!