The stock market finished lower on Thursday, with modest declines after having been up most of the day. After the size of the end-of-year rally that sent the Dow Jones Industrial Average (^DJI 0.67%) and S&P 500 (^GSPC 0.87%) to all-time highs Wednesday, one could argue that Wall Street was due for a rest. The Nasdaq Composite (^IXIC 1.11%) also lost about the same amount of ground on a percentage basis.
|
Index |
Daily Percentage Change (Decline) |
Daily Point Change |
|---|---|---|
|
Dow |
(0.25%) |
(91) |
|
S&P 500 |
(0.30%) |
(14) |
|
Nasdaq |
(0.16%) |
(25) |
Data source: Yahoo! Finance.
There were plenty of success stories in 2021 for stock investors. Major indexes have posted sizable gains that surprised many who had suspected that 2020's roaring rebound from the coronavirus bear market might have gone too far too fast. Yet among individual stocks that posted big gains during 2021, the most surprising in my view are Ford Motor Company (F 6.10%) and Signature Bank (SBNY). Here's why.
Ford shifts into high gear
Ford came into 2021 with a bit of positive momentum, having recovered from a seven-year slump that cost the stock about two-thirds of its value from 2013 to March 2020. Many feared that the legacy automaker had gotten left behind, with electric vehicle (EV) pioneer Tesla (TSLA -3.40%) having built up a multiyear head start while Ford and many of its peers lagged far behind in EV development.
Yet Ford's rebound came from a host of factors. Notably, the automaker's conventional fleet of fossil-fuel-powered vehicles saw huge demand, and Ford did a reasonable job of navigating its way through supply chain issues and shortages of automotive semiconductor chips to take advantage and boost its total vehicle sales. Commercial demand was particularly strong, and high-margin categories like SUVs served Ford well.
A Ford F-150 Lightning EV. Image source: Ford.
Longer term, Ford convinced investors that its modernization efforts can be successful. Integral to its plans will be the F-150 Lightning electric pickup, which should launch early in the coming year. But Ford is even seeing demand with its existing lines of all-electric and hybrid vehicles, particularly the Mustang Mach-E crossover SUV.
Ford investors have waited a long time for a rebound, and even after this year's 134% rise, the stock is still down almost 35% from its highs way back in 1998. Nevertheless, the automaker demonstrated that it could compete in a changing world, and that bodes well for its prospects in 2022.
Banking on big gains
Also rising big in 2021 was Signature Bank, which was up 137%. With the overall financial industry having undergone some struggles, many investors failed to see the New York-based bank's potential to cash in on the hot cryptocurrency space.
Signature's primary distinguishing factor is its Signet real-time payment processing platform. Using the power of blockchain, Signet facilitates instantaneous transactions in a manner that's especially handy for crypto investors trading digital assets on a 24/7/365 basis. To use Signet, customers have to put money on deposit with Signature, and that has helped the bank boost its assets dramatically at a very low cost of capital.
The strong performance in the crypto space reawakened interest in the financial infrastructure underlying digital asset trading, and that's helped create record earnings for Signature. The crypto trend isn't guaranteed to continue in 2022, but even if the most popular digital assets don't continue their bullish moves, Signature is still poised to take advantage of innovation in the broader crypto realm no matter where it comes from. That could help boost the stock price even further in the coming year.
