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State stocks stay strong
Index of Oklahoma-based stocks shows local companies offer bigger returns than overall stock market.
Oklahoma's economy has weathered the Great Recession as well as any state's, and the state's public companies have demonstrated a similarly robust constitution.
An index that represents the stocks of Oklahoma's 31 largest public companies reflects that strength.
The SPADE Oklahoma Index grew nearly 32 percent from July 1, 2009, through June 30, 2010 — the time frame that coincides with the period of evaluation of nearly all of the Oklahoma Inc. stocks.
In the same period, the Standard & Poor's 500 gained about 12 percent.
In other words, a $1,000 investment in that Oklahoma index would have produced a profit of $320 over the past year, compared with a $120 gain in the investment in the S&P 500.
Jim Huntzinger, chief investment officer for Tulsa's BOK Financial, said two factors appear to have played a role in the strong performance of state-based stocks.
"The emphasis in Oklahoma publicly traded companies from the energy sector has helped performance this year, and therefore the whole group is doing better than the general market,” Huntzinger said. In the first nine months of 2010, the stocks of Oklahoma energy companies have gained about 16 percent, well above the 6 percent return of the S&P 500, Huntzinger said.
Many of the state's public companies also are long-term players in their market, he said.
"Along with that comes stability and also probably comes lower debt levels,” Huntzinger said. "Many of these companies have debt levels that are very manageable.”
The dangers of excess leverage have been highlighted as the nation entered the Great Recession and now begins a slow economic recovery, he said.
The strong stock performance of state companies reflects a remarkable turnaround after a year that was marked with huge losses and massive uncertainty, Tulsa money manager Fred Russell said.
"It's been a good year — a very good year,” said Russell, head of Fredric E. Russell Investment Management Co.
Even by Wall Street standards, Oklahoma is more than OK.
While shareholders are most interested in the return on their investments, Oklahoma Inc. tracks two other metrics to rank the state's public companies.
The 36 state-based firms that trade on major exchanges are ranked by each of the three measures, and the company that achieves the best overall rankings collects the top spot.
Total return to investors includes gains or losses in stock price plus any dividends. Dollar Thrifty Automotive Group claimed that category with a 205 percent return.
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