New research identifies the 10 best-performing US stocks since 1926.
Of 29,000 US stocks traded since 1926, most had negative returns, but top performers showed consistent gains.
The study affirms the importance of “time in the market,” according to its author, Hendrik Bessembinder.
A new research paper has examined all 29,078 US stocks that have existed since 1926 and identified the top 10 performers of all time.
These stocks, some of them household names, have generated enormous wealth for those who purchased even just one share of the company and held on to it for nearly 100 years.
Of course, identifying the 10 best-performing stocks for the next 100 years is nearly impossible, as the paper’s author points out.
“The majority (51.6%) of these stocks had negative cumulative returns,” finance professor Hendrik Bessembinder of Arizona State University wrote.
But with a healthy dose of luck, $1 invested in 1926 would have been worth $2.67 million at the end of 2023, assuming it was invested in the right company.
Bessembinder also observed that the 10 best-performing stocks delivered consistently modest annualized gains, reinforcing the slow and steady mantra championed by long-term investors.
“Annualized compound returns to these top performers relatively were modest, averaging 13.47% across the top seventeen stocks, thereby affirming the importance of ‘time in the market,” Bessembinder wrote.
From soda to cigarettes to computers and airplanes, these are the 10 top-performing US stocks since 1926, according to the paper, which assumed that dividends were reinvested.
Pepsico
Ticker: PEP
Return of $1 invested : $86,360
Investment date: December 31, 1925 – December 29, 2023
Coca-Cola
Ticker: KO
Return of $1 invested : $123,724
Investment date: December 31, 1925 – December 29, 2023
S&P Global
Ticker: SPGI
Return of $1 invested : $128,787
Investment date: February 14, 1929 – December 29, 2023
Eaton
Ticker: ETN
Return of $1 invested : $151,173
Investment date: December 31, 1925 – December 29, 2023
International Business Machines
Ticker: IBM
Return of $1 invested : $175,437
Investment date: December 31, 1925- December 29, 2023
5. Boeing
Ticker: BA
Return of $1 invested : $212,206
Investment date: September 5, 1934 – December 29, 2023
General Dynamics
Ticker: GD
Return of $1 invested : $220,850
Investment date: January 28, 1926 – December 29, 2023
Kansas City Southern
Ticker: Delisted after 2021 acquisition by Canadian Pacific
Return of $1 invested : $361,757
Investment date: December 31, 1925 – December 13, 2021
Vulcan Materials
Ticker: VMC
Return of $1 invested : $393,492
Investment date: December 31, 1925- December 29, 2023
Altria Group
Ticker: MO
Return of $1 invested : $2,655,290
Investment date: December 31, 1925 – December 29, 2023
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