As the bears mauled stock prices for a second consecutive year, The Courant 100 suffered its share of flesh wounds.
The two largest companies bled about $84 billion in stock market value in the 52-week period ended May 17. The Courant 100, as a whole, shed almost $60 billion in total market value.
General Electric Co. and United Technologies Corp., The Courant 100 gained nearly $24 billion, for a total value of $589 billion.
But 16 companies, including GE, suffered market declines of 33 percent or more.
Although this year's list and last year's are not identical - 13 companies were replaced in the Top 100 rankings - certain patterns were repeated for a second consecutive year.
Winning stocks, for example, outnumbered declining stocks by almost a 2-1 ratio: 60 to 37. (Three companies went public after May 2001.) In 1999, by contrast, a majority of The Courant 100 stocks posted a year-to-year decline in price.
Most of the ten biggest winners in 2001-02 were also, for a second consecutive year, small or mid-sized companies - as measured by market capitalization. Three of the biggest winners were insurers. Five delivered double-digit total returns for a second consecutive year.
The ten stocks with the largest declines in The Courant 100, meanwhile, followed the behavior of stocks nationwide: technology shares suffered the biggest drubbing. Seven were manufacturers of high-technology equipment. Six, including Zygo Corp. and Applera Corp.'s Applied Biosystems Group and Celera Genomics Group (which each trade as separate companies from their parent), were high-flying growth stocks in previous years. Two - TranSwitch and Ames Department Stores - suffered routs for a second consecutive year. And all but NYFIX Inc. and Applied Biosystems reported a net loss in the most recently reported 12-month period.
Yet, as was the case with stocks in the rest of the United States, investors generally gravitated to those companies with improving fortunes. They favored the small and mid-sized companiesover the large. And they tended to flock to industries that were suddenly in favor, including health insurance.
There is, for example, no mystery why Aetna and Oxford Health Plans appear on the list of Top 10 gainers between May 2001 and May 2002. Many health insurance stocks have enjoyed a good run in recent months - and for reasons that are easy to enumerate, said Greg Crawford, an analyst with Fox-Pitt, Kelton in New York.
In recent years, health insurers have benefited from double-digit increases in premiums. They have found ways to leave markets in which they could not turn a profit. And, they have managed to impress upon their customers the need to pay a little extra - be it through higher deductibles or co-payments - to secure the luxury of choosing doctors, Crawford said.
In the mid- to late 1990s, "health insurers learned the hard way that if you misprice your business, you will probably lose money. Now they are selling their services at the proper price," Crawford said. Two other health insurers with strong ties to Connecticut, CIGNA Corp. and UnitedHealth Group Inc., also posted double-digit stock price increases during the 52-week stretch ended May 17.
Two sleepers in The Courant 100's hit parade included Silgan Holdings and Genesee & Wyoming Inc. Neither company can be classified as so-called "New Economy." Silgan makes cans and plastic containers for food processors; Genesee & Wyoming owns and manages several short-haul rail lines in the U.S., Mexico and Australia.
When it traded at about $18 a share last May, Silgan was trading at just 10 times earnings over the previous 12 months. The Stamford-based company, compared with many brand-name companies, represented a value play - and investors dove in, said one analyst.
"Silgan is a company that has enjoyed above-average returns on capital in its industry. Its success over the last year reflected a tendency for investors to see value in companies with hard assets," said George Staphos, an analyst who follows Silgan Holdings for Salomon Smith Barney.
With Genesee & Wyoming, investors also saw value, said another analyst. At about $12 a share in May 2001, Genesee & Wyoming traded at four times earnings over the previous 12 months. The company has also become a sudden favorite of small-company mutual funds, said Thom Albrecht, an analyst with BB&T Capital Markets in Richmond, Va.
TranSwitch in Shelton, in an opposite example, traded as high as $74 a share in October 2000. Yet the designer of semiconductor chips later suffered a sharp decline in customer orders, reflecting the nationwide pullback in technology spending. In 2000, TranSwitch rang up $155 million in sales. Sales slumped to $58.7 million last year as its major customers in telecommunications cut back on spending.
"TranSwitch's revenue for all of 2001 roughly equaled the revenue of their best quarter in 2000," said Alvin Kressler, an analyst who follows TranSwitch at Friedman, Billings, Ramsey in New York. Hopes for the company's survival rest on its pile of cash.
At Gerber Scientific in South Windsor, declining sales and earnings have also hauled down the stock price. The maker of computer-driven manufacturing systems for the sign, apparel and eyeglass industries has suffered from a slowing economy and a higher debt load - not to mention a federal investigation of its accounting practices.
All in all, the rising and falling fortunes of Courant 100 companies led to a combined 9 percent net market decline in the 52 weeks ending May 17 - from $647 billion to $589 billion. It would have been worse without three new arrivals joining the Top 10. In the same period, the Standard & Poor's 500 fell 14 percent, the Dow Jones industrials slipped 8 percent and the Nasdaq composite tumbled another 20 percent.