The 4 Most Important S&P 500 Stocks of the Past 16 Years

As the S&P 500 approaches a milestone of its own, we take a look back at the key stocks that have pulled it higher.

Jul 5, 2014 at 3:30PM

The S&P 500 (SNPINDEX:^GSPC) has languished in the shadow of the Dow Jones Industrials recently, with all the hype surrounding Dow 17,000 hiding the fact that the S&P is nearing a more important milestone of its own. With this week's gains, the S&P rests less than 15 points below the 2,000 level. Thousand-point gains in the Dow have seemed to come with clockwork reliability lately, but it's been more than 16 years since the S&P 500 first climbed above the 1,000 mark in early 1998. Along the way, the stocks that have contributed the most to its advance have come from two key sectors: technology and biotech. Let's take a closer look at how Apple (NASDAQ:AAPL) and (NASDAQ:AMZN) have joined with Celgene (NASDAQ:CELG) and Gilead Sciences (NASDAQ:GILD) to lead the S&P 500 higher.

AAPL Total Return Price Chart

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Apple's rise of more than 153 times has gotten plenty of attention over the years, but it's interesting to go back to 1998 to see what was happening with the tech giant at the time. Apple had just introduced its online store, allowing customers to order hardware products over the Internet, and Steve Jobs had returned for less than a year after Apple's purchase of NeXT. Later that year, Apple would introduce the iMac, whose design was led by Jonathan Ive, a key player in the development of the iPod and iPhone. Now, Apple has retained some of its connection to its past, but the devices that drive its success now look little like the Macintosh computers that helped Apple join the S&P 500 in the first place back in 1982.


Source: Amazon.

Amazon's 63-fold advance has come with plenty of bumps along the way. Founded in 1994, the online-retail pioneer didn't even go public until 1997, less than a year before the S&P hit 1,000. Shares soared as the popularity of the Internet lifted just about every stock related to the online experience during the late 1990s, and Amazon suffered huge declines during the ensuing bust during the early 2000s. S&P investors missed out on those two big moves up and down, as Amazon didn't join the S&P 500 until 2005. Nevertheless, the company has diversified into a number of new areas since then, offering just about any product imaginable from a retail standpoint as well as cloud-computing services, streaming video, and numerous other projects.

Celgene has jumped 127 times, with the biotech having been spun off from chemical giant Celanese in the mid-1980s. Back in 1998, the company was just months away from its initial success, as the FDA approval of Thalomid to treat a painful skin condition associated with leprosy. Later, the drug would become important as part of a combination-treatment for cancer, and further successes like its Revlimid treatment for anemia and multiple myeloma has become a blockbuster for the company. Celgene joined the S&P 500 in 2006. Lately, Celgene has ridden the wave of interest in biotechs higher, but it still has plenty of pipeline prospects that could produce future blockbuster treatments in the future.


Source: Gilead Sciences.

Gilead has risen 70-fold since 1998, joining the S&P 500 in 2004. Founded in 1987, the company went public in 1992 and almost immediately became known for its specialty in treating HIV and AIDS. Treatments like Truvada and Atripla helped countless HIV patients, but other products like influenza treatment Tamiflu also gained popularity. Recently, Gilead's Sovaldi treatment for hepatitis C has drawn the most attention as a potential game-changer for the company.

The S&P 500 has come a long way since it first hit 1,000 in early 2008, with some of its biggest companies having grown from nearly nothing to contribute to the index's success. In the next 16 years, you can expect similar surprises from companies you've never heard of that will be tomorrow's new S&P 500 members.

Leaked: Apple's next smart device (warning -- it may shock you)
Apple recently recruited a secret-development "dream team" to guarantee that its newest smart device was kept hidden from the public for as long as possible. But the secret is out, and some early viewers are even claiming that its everyday impact could trump the iPod, iPhone, and the iPad. In fact, ABI Research predicts that 485 million of these devices will be sold per year. But one small company makes this gadget possible. And its stock price has nearly unlimited room to run for early in-the-know investors. To be one of them, and to see Apple's newest smart gizmo, just click here!

Dan Caplinger owns shares of Apple. The Motley Fool recommends, Apple, Celgene, and Gilead Sciences and owns shares of, Apple, and Gilead Sciences. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

4 in 5 Americans Are Ignoring Buffett's Warning

Don't be one of them.

Jun 12, 2015 at 5:01PM

Admitting fear is difficult.

So you can imagine how shocked I was to find out Warren Buffett recently told a select number of investors about the cutting-edge technology that's keeping him awake at night.

This past May, The Motley Fool sent 8 of its best stock analysts to Omaha, Nebraska to attend the Berkshire Hathaway annual shareholder meeting. CEO Warren Buffett and Vice Chairman Charlie Munger fielded questions for nearly 6 hours.
The catch was: Attendees weren't allowed to record any of it. No audio. No video. 

Our team of analysts wrote down every single word Buffett and Munger uttered. Over 16,000 words. But only two words stood out to me as I read the detailed transcript of the event: "Real threat."

That's how Buffett responded when asked about this emerging market that is already expected to be worth more than $2 trillion in the U.S. alone. Google has already put some of its best engineers behind the technology powering this trend. 

The amazing thing is, while Buffett may be nervous, the rest of us can invest in this new industry BEFORE the old money realizes what hit them.

KPMG advises we're "on the cusp of revolutionary change" coming much "sooner than you think."

Even one legendary MIT professor had to recant his position that the technology was "beyond the capability of computer science." (He recently confessed to The Wall Street Journal that he's now a believer and amazed "how quickly this technology caught on.")

Yet according to one J.D. Power and Associates survey, only 1 in 5 Americans are even interested in this technology, much less ready to invest in it. Needless to say, you haven't missed your window of opportunity. 

Think about how many amazing technologies you've watched soar to new heights while you kick yourself thinking, "I knew about that technology before everyone was talking about it, but I just sat on my hands." 

Don't let that happen again. This time, it should be your family telling you, "I can't believe you knew about and invested in that technology so early on."

That's why I hope you take just a few minutes to access the exclusive research our team of analysts has put together on this industry and the one stock positioned to capitalize on this major shift.

Click here to learn about this incredible technology before Buffett stops being scared and starts buying!

David Hanson owns shares of Berkshire Hathaway and American Express. The Motley Fool recommends and owns shares of Berkshire Hathaway, Google, and Coca-Cola.We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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