NC companies shared in Wall Street's gains

adunn@charlotteobserver.comDecember 31, 2013 

Quintiles Executive Chairman Dennis Gillings, center right, and CEO Tom Pike, center left, open trading on May 10. Quintiles shares are up 8 percent.

BEN HIDER — 2013 NYSE Euronext

  • N.C. 50: The year in North Carolina stocks

    The 50 largest publicly traded companies headquartered in North Carolina, excluding companies that went public during the year. They are in order by annual revenue.

     Company Headquarters2013close2012close2008close1-year return5-yearreturn
    Bank of America Corp.Charlotte15.5711.6114.0834%11%
    Lowe’s Cos. Inc.Mooresville49.5535.5221.5239%130%
    Duke Energy Corp.Charlotte69.0163.845.038%53%
    Nucor Corp.Charlotte53.3843.1646.224%16%
    VF Corp.Greensboro62.3437.7413.6965%355%
    BB&T Corp.Winston-Salem37.3229.1127.4628%36%
    Family Dollar StoresMatthews64.9763.4126.072%149%
    Sonic Automotive Inc.Charlotte24.4820.893.9817%515%
    Reynolds American Inc.Winston-Salem49.9941.4320.1621%148%
    Pantry Inc.Cary16.7812.1321.4538%-22%
    Laboratory Corp. of AmericaBurlington91.3786.6264.415%42%
    SPX Corp.Charlotte99.6170.1540.5542%146%
    Lorillard Inc.Greensboro50.6838.8918.7830%170%
    Harris Teeter SupermarketsMatthews49.3538.5627.6528%78%
    Hanesbrands Inc.Winston-Salem70.2735.8212.7596%451%
    Ingles Markets Inc.Black Mountain27.117.2617.5957%54%
    Carlisle Cos. Inc.Charlotte79.458.7620.735%284%
    Babcock & Wilcox Co.Charlotte34.1926.2N.A.30%N.A.
    Chiquita Brands InternationalCharlotte11.78.2514.7842%-21%
    Alliance One InternationalMorrisville3.053.642.94-16%4%
    Old Dominion Freight LineThomasville53.0234.2812.6555%319%
    Martin Marietta MaterialsRaleigh99.9494.2897.086%3%
    Snyder’s-Lance Inc.Charlotte28.6624.1222.9419%25%
    Coca-Cola Bottling Co. Charlotte73.1966.545.9610%59%
    Cree Inc.Durham56.0452.9613.226%324%
    Fresh Market Inc.Greensboro62.5233.9815.8784%294%
    Red Hat Inc.Raleigh40.548.09N.A.-16%N.A.
    Piedmont Natural Gas Co.Charlotte33.1631.3131.676%5%
    RF Micro Devices Inc.Greensboro5.164.480.7815%562%
    EnPro Industries Inc.Charlotte57.6540.921.5441%168%
    First Citizens BancsharesRaleigh222.63163.5152.836%46%
    Horizon Lines Inc.Charlotte0.841.587.25-44%-99%
    Fairpoint Communications Inc.Charlotte11.317.95N.A.42%N.A.
    Cato Corp.Charlotte31.827.4315.116%111%
    Salix Pharmaceuticals Ltd.Raleigh89.9440.478.83122%919%
    Pike Corp.Mount Airy10.579.5512.311%-14%
    Unifi Inc.Greensboro27.2413.018.46109%222%
    Polypore International Inc.Charlotte38.946.57.56-16%415%
    Highwoods Properties Inc.Raleigh36.1733.4527.368%32%
    Xerium Technologies Inc.Raleigh16.493.0513.2441%25%
    Speedway Motorsports Inc.Concord19.8517.8416.1111%23%
    Krispy Kreme Doughnuts Inc.Winston-Salem19.299.381.68106%1048%
    Tanger Factory Outlet Centers Inc.Greensboro32.0234.218.81-6%70%
    Insteel Industries Inc.Mount Airy22.7312.4811.2982%101%
    Culp Inc.High Point20.4515.011.9836%933%
    Powersecure International Inc.Wake Forest17.177.813.29120%422%
    Hatteras Financial Corp.Winston-Salem16.3424.8126.6-34%-39%
    Swisher Hygiene Inc.Charlotte0.551.730.37-68%49%
    Triad Guaranty Inc.Winston-Salem0.270.070.38286%-29%
    Cornerstone Therapeutics Inc.Cary9.494.732.65101%258%

    Source: Bloomberg

It was a great year to be in the stock market in 2013. For North Carolina’s largest companies, it was even better.

Of the state’s 50 biggest publicly traded companies by revenue, 43 finished the year with a higher stock price than they had at the end of 2012, according to an Observer analysis of Bloomberg data. Seven of them more than doubled in price.

Measured like an index, the 50 stocks increased by 28 percent. Looked at another way, if you had put $100 into each stock at the start of the year, you’d have earned a whopping 44 percent return, not including dividends.

Lowe’s Cos., the Mooresville-based home improvement retailer, gained nearly 40 percent as a rebounding housing market led people to spend more on home renovations. Charlotte steelmaker Nucor Corp. gained 24 percent. Bank of America, the state’s largest public company by revenue, remains below its 2006 peak, but it finished the year with a 34 percent increase as the Charlotte bank continued to cut costs and clear up legal issues.

North Carolina stocks mirrored the optimism of the broader market. Corporations kept posting strong profits, and monetary stimulus from the Federal Reserve kept money flowing from bonds into stocks.

The Dow Jones Industrial Average set record highs 52 times over the course of the year, cracking 15,000 and later 16,000 for the first time in history. The index gained more than 26 percent in 2013, its best performance since the mid-1990s.

The Standard & Poor’s 500 Index, a broader measure of the stock market, gained nearly 30 percent.

“There was a lot to be happy about,” said Judson Gee, managing partner of JHG Financial Advisors in Charlotte. After several years of worry about the strength of the economy and where the market would go, investors decided to take a look at corporate America’s strong earnings, Gee said. And, he said, “the numbers are good.”

To be sure, stock price appreciation is just one measure of how a company is faring. But the analysis provides a window into how investors viewed the health of North Carolina’s largest companies over the past year.

It was also a banner year for IPOs in the state: At least 10 North Carolina companies went public in 2013. One of the largest, Charlotte-based Premier Inc., began trading on the Nasdaq exchange in September, raising more than $760 million. Durham-based pharmaceutical services company Quintiles, raised $947 million in May. The Observer’s analysis does not include companies that went public in the past year.

Rebounds and records

North Carolina’s top-performing stocks relied on new products, contracts or a significant rebound to outperform the market in a year where nearly everyone did well.

• Just three years removed from bankruptcy, Raleigh-based Xerium Technologies was the state’s top performer, with the stock rising 441 percent. The company’s restructuring plan and a major cost-cutting program appealed to investors. Xerium, which makes equipment used to produce paper, also announced it would build a new high-end plant near Shanghai.

• Raleigh’s Salix Pharmaceuticals gained 122 percent on strong earnings for its drug that treats a liver disorder. The share price jumped in November when it announced it would buy a company that deals with medications for gastrointestinal issues.

• Wake Forest-based PowerSecure International jumped 120 percent. The company announced it had landed a contract to provide transmission infrastructure to an unnamed major utility that executives said would double the company’s work volumes.

Nationwide, the year’s hottest stocks came in the consumer discretionary category as rising home prices made people feel more wealthy, said Brian Rudisill, senior vice president of Novare Capital Management in Charlotte.

That lifted a range of companies, from Krispy Kreme Doughnuts Inc. to apparel maker Hanesbrands –both based in Winston-Salem; the two roughly doubled in price.

Industrial companies, which tend to be cyclical, also rose substantially as the economy bounced back and people were more willing to buy.

Manufacturers Cree Inc. in Durham, Insteel Industries in Mount Airy, and EnPro Industries in Charlotte all outperformed the market.

Charlotte-based Duke Energy finished with an 8 percent increase, lagging behind the broader markets. Utilities in general were some of the market’s worst performers after several years of big gains. Investors decided to take money out of solid, lower-growth companies and invest in faster-growing firms, said Don Olmstead, Novare Capital’s managing director.

Troubles

Three Charlotte companies that faced a range of problems in 2013 were among the lowest-performing companies in the top 50.

• Swisher Hygiene finished a troubled year with a stock price drop of nearly 70 percent to be the worst performer in the group. The cleaning chemical company faced federal lawsuits from shareholders and disclosed that it had been contacted by federal prosecutors and the Securities and Exchange Commission about alleged accounting irregularities.

• Shipping company Horizon Lines had another rough year in the markets. In his first full year at the helm, CEO Sam Woodward dramatically cut costs and brought the company into the black in the third quarter. Executives also pointed to the company’s earnings before interest, taxes, depreciation and amortization – which increased by nearly half in the first three quarters of 2013.

But Horizon Lines still lost nearly $18 million through the first nine months of the year, and investors sold the stock below a dollar per share.

• Polypore International, which makes high-tech filtration systems for everything from water purifiers to laptops, lost 16 percent of its value over the year. CEO Robert Toth told investors in November that he understood the company’s performance in lithium-ion battery separators was “disappointing” but pledged that Polypore was working to address the problems.

The share price has been bouncing back over the past week, however. The company announced a settlement last week with a company Polypore claimed was infringing on a lithium patent it held. Polypore would receive an up-front payment and end months of legal wrangling.

David Bracken of The (Raleigh) News & Observer contributed.

Dunn: 704-358-5235; Twitter: @andrew_dunn

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