The market may have posted generally flat returns in 2011, but this doesn't mean that all investors were simply running in place.
There were actually several stocks that performed quite well last week, and reading into the things that went right for them in 2011 may help you identify the traits in the stocks that will more than double in 2012.
Let's go over five of last year's biggest winners.
The provider of e-commerce marketplaces for surplus and salvage assets in the retail, government, and capital assets sectors is in the right place at the right time.
There's rarely a shortage of distressed assets to clear out, but this past year has been particularly good for Liquidity Services. A record $558.5 million in merchandise was exchanged through Liquidity's marketplaces in fiscal 2011, 30% more than Liquidity Services was able to clear a year earlier.
Guidance for fiscal 2012 looks even better, as Liquidity Services is targeting gross merchandise value of $690 million to $730 million to be sold through its exchanges this year.
The oncology-focused biotech got the year off to a strong start when its stock popped 30% in a single day in January. A late-stage clinical trial test for its sarcoma drug, ridaforolimus, resulted in extending the time it takes for the cancer to proceed by a little more than three weeks.
Three weeks may not seem like much, but good luck convincing someone on borrowed time that the extra time isn't relevant.
Ariad is a small company, but it's backed by a rich pipeline of drugs in development.
This Dublin company is doubling.
The Irish biotech had been waffling about in the single digits since late 2008, when cases of a potentially fatal brain infection began inflicting patients on its multiple sclerosis drug, Tysabri.
Elan hasn't been able to fully lay those demons to rest with its marquee drug, but sales of Tysabri still rose 28% through the first nine months of 2011. In other words, it's not perfect but the drug is still too vital to dismiss.
Elan also came through with an asset sale that helped shore up its balance sheet.
Three years ago, opportunistic investors were able to scoop up shares of the Sleep Number bed maker for just $0.20. How pumped must those shareholders be if they held on to their 100-bagger now that the stock is in the low $20s.
Then again, the recession three years ago was killing demand for the pricey air-chambered mattresses with adjustable firmness settings.
The economy may not necessarily be any better, but folks are valuing a good night's sleep these days. Select Comfort has blown analyst profit targets away over the past year by no less than 15% in any given quarter. By the time Select Comfort reports its final numbers for 2011, Wall Street expects profitability to nearly double to $1.01 a share.
Yes, the folks who were paying two dimes for the stock nearly three years ago were actually paying an eventual multiple of 0.2 time earnings two years out.
Consumer electronics retailing has been a dreadful sector lately.
Thankfully, Conn's emphasis on appliances, furniture, mattresses, and even lawn care equipment has helped it withstand the growing popularity of online merchants selling light or digital media. Revenue growth hasn't been impressive but analysts forecast Conn's to see its profit more than triple in the fiscal year that ends later this month.
Few figured that selling lawn mowers or inflatable beds would be the ticket to market-thumping returns in 2011. The year ahead will also offer some intriguing if not unlikely victors.
Motley Fool newsletter services have recommended buying shares of Liquidity Services and Elan. Try any of our Foolish newsletter services free for 30 days. We Fools may not 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.
Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story. Rick is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early.
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