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It’s been a rough six months for most S&P 500 investors. But if you think that’s bad, try owning a money-losing stock for a decade — it’s not as unusual as you might think.
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Nearly 40 stocks in the S&P 500 — including consumer discretionary Carnival (CCL), fallen industrial giant General Electric (GE) and disappointing communications firm AT&T (T) — saw their shares go absolutely nowhere in an entire decade, says an Investor’s Business Daily Analysis of data from S&P Global Market Intelligence and MarketSmith. Some of the stocks are actually down by sizable amounts in that time.
Much of these losses, too, accelerated in just the past six months in the bear market. And it’s another reminder of how simply holding and hoping doesn’t always work out.
“If you want to practice ‘buy and hold’ for years (if not decades) of investing, then you need to be able to identify companies that have long runways and huge moats that can grow and grow and grow,” said Whitney Tilson, of Empire Financial Research, prior to the sell-off last year.
Dangers Of Buy And Hold
It’s easy to imagine the end of a bear market if you think it’ll be a distant memory in a decade. But what if your money sits dormant for 10 whole years? That’s harder to ignore.
And it’s more common than you might think. Nearly 35 of the S&P 500 stocks lost 10% or more in the past 10 years. And 14 are down more than 40%. And most painful of all: Two S&P 500 stocks lost 70% of their value in that time.
It’s important to note that the ongoing bear market is largely responsible for wiping out many years of gains in a short period of time. Take Carnival. Shares lost more than half their value just this year. And that’s a big reason why the cruise ship operator’s shares are more than 70% lower than they were 10 years ago. Certainly, the cruising shutdowns during the Covid-19 pandemic haven’t helped much.
AT&T And General Electric Not Money In The Bank
Not long ago, investors thought AT&T and GE were true “buy and hold” stocks. But that hasn’t been the case in the past 10 years.
Take AT&T, thought to be the ultimate widows and orphans stock. Granted, the stock yields 5.3% and has distributed some shares of spinoffs over the years. Even so, shares of AT&T proper are down more than 40% in the past 10 years. And you can’t just blame this year’s bear market. Shares are only down 14% this year. That’s actually a tad better than the S&P 500’s 18.1% drop this year.
And then there’s General Electric. Amazingly, GE was the most valuable company in the S&P 500 in 2005, ahead of Exxon Mobil (XOM) and Microsoft (MSFT). It was also No. 1 in 2004, 2003, 2001 and 2000. And for that, you can’t fault S&P 500 investors at the turn of the century for thinking it was unstoppable. But that was a mirage. Despite some spinoffs, shares dropped more than 60% in the past 10 years. What’s more, its famous yield shriveled up, too. GE now yields less than 1%.
And the whole energy sector, too, is a reminder of the perils of buying and holding. Sure, investors owning energy shares are up this year. But even following this year’s powerful rally, seven energy stocks in the S&P 500 are still down in the decade. Who’s bragging about owning them now?
‘Dead Money’ S&P 500 Stocks In The Past 10 Years
They’re all down in the past decade (excluding spinoffs and dividends)
| Company | Symbol | 10-year change | Sector |
|---|---|---|---|
| Carnival | (CCL) | -72.3% | Consumer Discretionary |
| Lumen Technologies | (LUMN) | -72.2% | Communication Services |
| Vornado Realty Trust | (VNO) | -64.5% | Real Estate |
| General Electric | (GE) | -60.6% | Industrials |
| APA | (APA) | -59.7% | Energy |
| Viatris | (VTRS) | -51.7% | Health Care |
| Kinder Morgan | (KMI) | -48.8% | Energy |
| Schlumberger | (SLB) | -47.2% | Energy |
| Warner Bros. Discovery | (WBD) | -45.0% | Communication Services |
| Tapestry | (TPR) | -44.3% | Consumer Discretionary |
| Wynn Resorts | (WYNN) | -42.5% | Consumer Discretionary |
| Healthpeak Properties | (PEAK) | -40.6% | Real Estate |
| DuPont de Nemours | (DD) | -40.4% | Materials |
| AT&T | (T) | -40.3% | Communication Services |
| Bath & Body Works | (BBWI) | -38.6% | Consumer Discretionary |
| Simon Property Group | (SPG) | -37.8% | Real Estate |
| Dish Network | (DISH) | -36.6% | Communication Services |
| Ralph Lauren | (RL) | -35.5% | Consumer Discretionary |
| Franklin Resources | (BEN) | -34.7% | Financials |
| Penn National Gaming | (PENN) | -30.6% | Consumer Discretionary |
| Baker Hughes | (BKR) | -29.3% | Energy |
| Occidental Petroleum | (OXY) | -27.9% | Energy |
| International Business Machines | (IBM) | -26.4% | Information Technology |
| PVH | (PVH) | -26.4% | Consumer Discretionary |
| Invesco | (IVZ) | -26.0% | Financials |
| FirstEnergy | (FE) | -24.3% | Utilities |
| Paramount Global | (PARA) | -20.5% | Communication Services |
| Ventas | (VTR) | -20.0% | Real Estate |
| Mosaic | (MOS) | -18.7% | Materials |
| Boston Properties | (BXP) | -17.8% | Real Estate |
| Las Vegas Sands | (LVS) | -16.7% | Consumer Discretionary |
| Freeport-McMoRan | (FCX) | -16.5% | Materials |
| Marathon Oil | (MRO) | -12.5% | Energy |
| Nielsen Holdings | (NLSN) | -11.1% | Industrials |
| Federal Realty Investment | (FRT) | -8.2% | Real Estate |
| Devon Energy | (DVN) | -6.3% | Energy |
| Dentsply Sirona | (XRAY) | -4.0% | Health Care |
| PPL | (PPL) | -2.4% | Utilities |
Sources: IBD, S&P Global Market Intelligence
Follow Matt Krantz on Twitter @mattkrantz
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