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FTSE 100 stocks you should have bet your house on in 2017

Look at what you could have won...borrowing Bullseye host Jim Bowen's catchphrase, stock-picker-in-residence John Harrington looks at the winners (and losers) of the blue-chip index
back to the future
Back to the future: If you had luck, foresight, access to a Tardis or a DeLorean car fitted with a flux capacitor you could have made out like a bandit on some Footsie stocks

It sounds churlish but in a year when US indices appeared to hit records each week, the 5.3% rise by the Footsie seems stingy.

If you had luck, foresight, access to a Tardis or a DeLorean car fitted with a flux capacitor, however, you could have made out like a bandit on some Footsie stocks.

The best performer was NMC Health plc (LON:NMC), the healthcare services provider focused on the United Arab Emirates.

The stock has risen 77% year-to-date, which played a big part in its promotion to the FTSE 100 at the end of September.

Payment processor

The second best performer was the payments solutions provider Worldpay Group PLC (LON:WPG), which was up 59% after succumbing to a bid from rival US credit card processing firm Vantiv.

Worldpay only made it into the Footsie at the end of 2016, so the moral from NMC and Worldpay seems to be: look for the up-and-comers in the FTSE 250 if you want to find likely future star performers.

Completing the top three was house-builder Persimmon PLC (LON:PSN), which rose 53% this year and paid some juicy dividends along the way to boot.

The share price accumulation caught the Persimmon remuneration committee on the hop as it neglected to put a cap on management's long term incentive plan (share options etc.) when it was introduced in 2012.

Fast forward five years from 2012 and management is in line for a windfall of £600mln or so, with chief executive Jeff Fairbairn looking at a pay-out of more than £10mln, which should buy him a couple of bitcoins.

Plenty to chew on

The firm’s senior independent director and chairman of its remuneration committee, Jonathan Davie, did the decent thing this month and resigned from the board, while company chairman Nicholas Wrigley was given plenty to chew on by the City and decided to retire.

It's unlikely any such bonuses will be coming the way of the chief executive of Centrica PLC (LON:CNA), the Footsie's worst performing stock this year, although that is possibly a naive view given the “reward for failure” culture endemic in board rooms across the globe.

The British Gas-owner had a torrid year, losing customers, cheesing off the industry watchdog (though it was not alone in this), the Conservative Party (which decided to take a leaf out of Ed Miliband's book and target all the utility companies in its general election rhetoric), and generally raising doubts over whether the dividend is sustainable.

Seeing as the dividend is about 99.9% of the reason for holding shares in a utility company, things are pretty serious for the little-loved company.

The divi is also a concern at BT Group plc (LON:BT.A), the second worst performing Footsie stock in 2017.

Down 26% 

The stock shed 26% with investors also fretting about the pension deficit, the potential of a can of worms in the Italian subsidiary where the accounts have been sussy, and the prospect of being forced to invest a huge amount of money in a fibre optic broadband network and then having to make it available to the competition.

Somehow the dividend has survived, and the group has at least come to some sort of accommodation with its pay-TV rival Sky, so maybe it will bounce back next year.

If advertising and marketing giant WPP PLC (LON:WPP) is a bellwether for the global economy, then we're all in a bit of trouble as the shares lost a quarter of their value this year.

There is a school of thought, however, that WPP's problems are more to do with the rise of digital marketing, and the increasing power of Facebook and Google, which account for about 75% of digital advertising and 30% of total advertising.

WPP’s response in the past to threats has been to buy out the competition; good luck trying that with Google’s owner Alphabet Inc (NASDAQ:GOOGL) valued at US$743bn and Facebook Inc (NASDAQ:FB) valued at US$517bn.

 

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