January was not a fun month to be an equity investor, but not all stocks were down, and a handful even showed dramatic gains. This included three financial stocks that were among the worst performing stocks in the S&P 500 in 2009.

IN PICTURES: 8 Signs Of A Doomed Stock

Marshall & Isley Corp (NYSE:MI), Zions Bancorp (Nasdaq:ZION) and Huntington Bancshares (Nasdaq:HBAN) all lost more than 50% of their value in 2009, as they saw loan portfolios go sour during the year. Yet all three had dramatic comebacks in January, as investors decided to make bets that things will get better for these banks in the new year.

Zions Bancorp was the best-performing stock in the S&P 500 for the first month of 2010, returning 48% to investors. The bank reported a loss of $176.5 million, or $1.26 per share in the fourth quarter of 2010, but investors were heartened by a sequential increase in the company's tangible common equity ratio and signs of improvement in other credit metrics.

However, despite this strong gain, Zions Bancorp remains well below its pre-recession high price of $80 per share reached early in 2007.

Marshall & Isley Corp. reported a loss in the fourth quarter of 2009 of $259.5 million, or 54 cents per share. The bank also showed a slight improvement in key credit quality metrics relative to previous quarters, convincing investors that the peak in losses might have passed.

Greg Smith, the CFO of Marshall & Isley, touted this improvement during the earnings conference call. "Early stage delinquencies, which decreased for the third consecutive quarter, continued improvement in total nonperforming loans, which decreased for the second consecutive quarter," said Smith. Marshall & Isley Corp was up 26% in January.

Huntington Bancshares rebounded strongly during January, returning 30%. Earnings were once again the catalyst along with a perception that things were "less worse" at the bank. During the conference call, Steve Steinour, the CEO, said, "sometime during 2010 we expect to return to quarterly profitability."

KeyCorp (NYSE:KEY), another bank, was up 26% in January, as it reported a smaller year-over-year loss in the fourth quarter of 2009. The bank is one of the largest regional banks with nearly 1,000 branches in 14 states.

The second best performing stock in January, and the only non-financial stock on the list, was Eastman Kodak (NYSE:EK), which was up 40% for the month. Kodak shocked the Street by reporting a GAAP profit of $430 million in the fourth quarter of 2009. During the earnings conference call, management proudly proclaimed that the company was "gaining momentum" after more than a year of losses.

The Bottom Line
Most investors probably spent the weekend recovering from January's poor stock performance, but there are a few stocks whose January performance left investors with something to celebrate. (Find out how to pick your own investments like a pro. Read How Investors Can Screen For Stock Ideas.)

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!

Related Articles
  1. Investing News

    Today's Sell-off: Are We in a Margin Liquidation?

    If we're in market liquidation, is it good news or bad news? That party depends on your timeframe.
  2. Investing News

    Bank Stocks: Time to Buy or Avoid? (WFC, JPM, C)

    Bank stocks have been pounded. Is this the right time to buy or should they be avoided?
  3. Stock Analysis

    Why the Bullish Are Turning Bearish

    Banks are reducing their targets for the S&P 500 for 2016. Here's why.
  4. Stock Analysis

    How to Find Quality Stocks Amid the Wreckage

    Finding companies with good earnings and hitting on all cylinders in this environment, although possible, is not easy.
  5. Chart Advisor

    How Are You Trading The Breakdown In Growth Stocks? (VOOG, IWF)

    Based on the charts of these two ETFs, bearish traders will start turning their attention to growth stocks.
  6. Stock Analysis

    Analyzing Sirius XM's Return on Equity (ROE) (SIRI)

    Learn more about the Sirius XM's overall 2015 performance, return on equity performance and future predictions for the company's ROE in 2016 and beyond.
  7. Stock Analysis

    Will Virtusa Corporation's Stock Keep Chugging in 2016? (VRTU)

    Read a thorough review and analysis of Virtusa Corporation's stock looking to project how well the stock is likely to perform for investors in 2016.
  8. Stock Analysis

    Analyzing Porter's Five Forces on JPMorgan Chase (JPM)

    Examine the major money-center bank holding firm, JPMorgan Chase & Company, from the perspective of Porter's five forces model for industry analysis.
  9. Chart Advisor

    Watch This ETF For Signs Of A Reversal (BCX)

    Trying to determine if the commodity markets are ready for a bounce? Take a look at the analysis of this ETF to find out if now is the time to buy.
  10. Investing News

    What You Can Learn from Carl Icahn's Mistakes

    Carl Icahn has been a stellar performer in the investment world for decades, but following his lead these days could be dangerous.
RELATED FAQS
  1. When does a growth stock turn into a value opportunity?

    A growth stock turns into a value opportunity when it trades at a reasonable multiple of the company's earnings per share ... Read Full Answer >>
  2. What is the formula for calculating EBITDA?

    When analyzing financial fitness, corporate accountants and investors alike closely examine a company's financial statements ... Read Full Answer >>
  3. How do I calculate the P/E ratio of a company?

    The price-earnings ratio (P/E ratio) is a valuation measure that compares the level of stock prices to the level of corporate ... Read Full Answer >>
  4. How do you calculate return on equity (ROE)?

    Return on equity (ROE) is a ratio that provides investors insight into how efficiently a company (or more specifically, its ... Read Full Answer >>
  5. How do you calculate working capital?

    Working capital represents the difference between a firm’s current assets and current liabilities. The challenge can be determining ... Read Full Answer >>
  6. What is the formula for calculating the current ratio?

    The current ratio is a financial ratio that investors and analysts use to examine the liquidity of a company and its ability ... Read Full Answer >>
COMPANIES IN THIS ARTICLE
Trading Center