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The 10 Best Stocks in the Nasdaq in 2015

By Dan Caplinger - Jan 13, 2016 at 7:36PM

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These stocks were the best performers in the index last year.

The Nasdaq 100 Index was one of the best-performing U.S. major market benchmarks in 2015, climbing more than 8% even before considering the positive impact of dividends. A big part of the reason for the Nasdaq's gains was its overweighting in highly successful tech stocks, many of which climbed substantially last year. Let's look at the 10 top-returning components of the Nasdaq 100 in 2015 and see what they can tell us about the market's future.

Stock

2015 Return

Netflix

134.4%

Amazon.com

117.8%

Ctrip.com International (TCOM -1.80%)

103.6%

Activision Blizzard (ATVI -0.22%)

94.1%

NVIDIA

67.1%

Incyte

48.3%

Starbucks

48.2%

Expedia

46.8%

Alphabet Class A (GOOGL 0.32%)

46.6%

Electronic Arts (EA 0.00%)

46.2%

Data source: S&P Capital IQ.

Big tech reigns supreme
From the list and from the Nasdaq's outperformance compared to broader benchmarks, it's clear that technology played a key role in powering advances for the Nasdaq index. The continued dominance of Netflix and Amazon in their respective arenas impressed investors in 2015, leading both of those stocks to double from their end-of-2014 levels.

Yet Google parent Alphabet also climbed into the upper echelons on a return basis. Much of the positive reception came from the arrival of new CFO Ruth Porat, who was instrumental in organizing the reorganization of Google to create the Alphabet parent company. Stock buybacks in October also made investors happy, and the latter can expect more transparency about the other initiatives that the company has taken on, including things like its driverless car program and its investment arms.

Also among the doubling ranks was Chinese travel giant Ctrip.com, which made some smart strategic decisions to reach the pinnacle of its industry. Even as competition rose in the Chinese travel space, Ctrip managed to make the transition to the mobile-device realm very effectively, hitting 800 million downloads for its app before 2015 had even reached the halfway point. The decision to merge with rival Qunar eliminated a key source of potential difficulty for Ctrip, and now, many expect Ctrip to work more closely with other participants internationally to make the most of its leadership role in Chinese travel.

Winning the game
The other area that shined in 2015 was the video gaming arena, where both Activision Blizzard and Electronic Arts saw big gains. The most important contributor to that strong performance came from the move toward digital distribution, which has allowed both Activision and EA to bring in more revenue and widen profit margins. By cutting out retail intermediaries, Electronic Arts and Activision Blizzard can release new games digitally, streamlining rollouts and getting games in front of its customers more quickly. Activision has done a better job of embracing digital releases, with about two-thirds of its sales coming from digital downloads, but Electronic Arts has moved aggressively to get its share from digital moving higher as well.

Key franchises also helped support share prices. For Activision Blizzard, the latest Call of Duty game generated its usual level of excitement, and other games like Destiny and Hearthstone also added to its overall success. The acquisition of King Digital promises even more expansion ahead for Activision. Meanwhile, Electronic Arts cashed in on Star Wars: Battlefront, jumping on the coattails of the massive franchise. Given the success of the new movie in the venerable franchise, Electronic Arts can expect even greater sales, with the digital delivery channel likely to post a big success for the game maker.

The Nasdaq 100 crushed the broader market in 2015, and these stocks were a big reason why. With favorable trends in video gaming and online travel continuing, many of these stocks could continue climbing over the course of this year as well.

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Dan Caplinger owns shares of Starbucks. The Motley Fool owns shares of and recommends Activision Blizzard, Alphabet (A shares), Amazon.com, Netflix, and Starbucks. The Motley Fool recommends Ctrip.com International and NVIDIA. 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.

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Stocks Mentioned

Alphabet Inc. Stock Quote
Alphabet Inc.
GOOGL
$119.93 (0.32%) $0.38
Electronic Arts Inc. Stock Quote
Electronic Arts Inc.
EA
$133.17 (0.00%) $0.00
Trip.com Group Limited Stock Quote
Trip.com Group Limited
TCOM
$25.72 (-1.80%) $0.47
Activision Blizzard, Inc. Stock Quote
Activision Blizzard, Inc.
ATVI
$80.35 (-0.22%) $0.18

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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