Diamonds and Dogs

12/31/15

Hope you got everything you wanted this holiday season because 2016 is coming! Today we are picking one of this year's biggest gainers. The honor goes to Amazon.com, the E-commerce giant celebrating its 20th anniversary with results that sent investors into a buying frenzy. Amazon was the second biggest gainer in the S&P 500 for the year, up 118 percent. The company is on track to report more than $100 billion in revenue in 2015 and it has started to turn in higher profits more frequently despite a loss in the first quarter. Thanks to the stock surge, the company's market value past that of longtime competitor Wal-Mart. Wal-Mart stock fell 29 percent in 2015, which made this Wal-Mart's worst year since 1974, when it had fewer than 100 stores.  Times are a changing in the retail economy.

2015 will go down as one of the worst years in recent history for energy. Many of the oil companies started their slide in April, but one energy stock has been going down for years. The dog of the day, for the year and maybe the last five years is Peabody Energy (BTU). In 2015, shares of Peabody have declined more than 92% and are down more than 99% since the peak of the commodities boom in 2011. For decades, coal absolutely dominated the U.S. electricity generation space. It was reliable, it was cheap to build and maintain, and few other sources have given it much of a run for its money. In 2001, coal was responsible for more than 50% of all electricity produced. How things have changed in the last 14 years. 2016 may be make or break for Peabody. Let's hope it staves off bankruptcy.