It’s a little hard to believe, but 2024 has been a great year for the stock market. Despite all the conflict and uncertainty around the world, the S&P 500 has notched a 26% gain year-to-date, far outstripping its long-term average annual return of around 10%.
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Passive investors, who try to replicate the performance of the total market by investing in index funds, have had a great year so far — but there are always some stocks that perform even better than the market average. Most investors who buy individual stocks typically are trying to beat the market and get those outsized returns.
When a stock does beat the market, fear of missing out can make it very tempting to invest, but past performance is no guarantee of future success. What has gone up can always come down, so should you buy? Here’s a look at four stocks that have done well in 2024.
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YTD gain: 44.17%
Better known by its former name, Raytheon Technologies, RTX Corporation is the second largest defense contractor in the United States. As a large conglomerate, it is engaged in a variety of businesses that include aerospace products, aircraft engines and missile systems.
Given the amount of military aid that the U.S. is currently sending to several conflict zones, it shouldn’t come as a surprise that a defense contractor is doing well. Whether or not that success will continue is unclear. Dr. Peter C. Earle, senior economist with the American Institute for Economic Research, noted that a new presidential administration could have an impact on RTX’s business.
“Should the incoming Trump administration follow through on its pledges to force other nations to fend for themselves, the largest publicly traded defense contractors might be poised for a pullback,” Earle said.
Verdict: NO
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YTD gain: 83.12%
Investors have generally been very well rewarded for holding the stock of retail titan Walmart, and this year has been no exception, as the stock has seen more than double the return of the S&P 500. However, there are some possibly very troubling headwinds that have the potential to make a massive impact on Walmart’s operations.
“A cornerstone of the Trump campaign has been tariffs and other forms of trade protectionism. If tariffs of the type which have been discussed are put in place — 60%, 100%, 200%, and so on — retaliatory tariffs would follow. Those could, in turn, devastate companies that rely on imports, [such as] Walmart,” Earle said, citing the fact that Walmart imports many of its goods from Chinese suppliers.
