Does Great Product make Great Stock ?

Sometime , we get attracted to the product we use , and buy the stock hoping it will rock the market.  Just the great product does not make great companies. There are many examples, where the companies product has gone wrong . Stock  price to rise , it has to have good management , consistent revenue growth and more importantly the profits. Below are some example , where the product is great , but the  stock returns have been worse.

 

  1. Fitbit  ( FIT)-   This changed the fitness of many individuals . But the stock has returned negative -85%, if you invested 10K , the value would be now only 1,500 now.
  2. Groupon (GRPN)- This has very popular in frugal living community. But the stock has returned -82% from its IPO.  There is no insight of any merger or spinoff.
  3. Under Armour (UA) : Amazing products , Big line of fitness wears , quality is incomparable . The stock has returned -65% in last 3 years.
  4. Mattel : They are the most favorites for the kids, starting from FirsherPrice to Cars, Disney , Barbie etc. But the stock has returned -65% last 3 years
  5. General Electric  (GE) :  Your life revolves around GE, they are pioneers in many industries . They are into Oil, Medical , Aviation , transportation , energy etc. But the stock has  returned -40% in last 3 years.
  6. JC Penney  (JCP): Lot of shopping happen in Jc Penney , but the stock has returned -85% in last 5 years.

 

Above is just few examples , but the list goes on. Look at the financials and technicals  and do some homework prior to entering into any stocks.

What are your thoughts ? Share it.

Leave a Reply