Tech and Media Biggest Value Creators in Last 5 Years: BCG

Tech and media stocks made investors a lot of money over the past five years.

According to a global study from the Boston Consulting Group (BCG), the nine of the 10 large companies that generated the highest shareholder returns from 2013 to 2017 all belonged to one of those two sectors. Chipmaker Nvidia Corp. (NVDA) came out on top, followed by subscription service Netflix Inc. (NFLX), semiconductor specialist Broadcom Inc. (AVGO), China’s internet service portal Tencent Holdings Ltd. (TCEHY) and social network Facebook Inc. (FB).

Sony Corp. (SNE), Keyence Corp. (KYCCF), Inc. (AMZN), Abode Systems Inc. (ADBE) and Kweichow Moutai Co. made up the rest of the top 10. (See also: NVIDIA Stock May Hit Record High on Profit Growth.)

“We have not seen such a dominance of effectively two sectors—technology and media and publishing—over the 20-year history of the BCG Value Creators research,” said Alexander Roos, a senior partner at BCG, in a press release. “It clearly shows how technology, data and content have become the most critical resources for value creation.”

Technology and media stocks also occupied 13 of the top 20 places in the ranking.

BCG calculated total shareholder returns by focusing on capital appreciation, increases in the prices of assets, and dividend payments across a list of 2,425 companies across the globe. The top 10 performers produced a five-year average return of 49%. Nvidia and Netflix, the two leaders, posted returns of 76% and 71%, respectively.

The only non-tech or media stock to make the top 10 was Kweichow Moutai, a Chinese producer and seller of distilled liquor products. Five of the top 10 large-cap value creators were U.S.-based, while the other five were Asian companies.

“The strong TSR performance of emerging Asian companies in the overall database suggests that the global large caps dominating the headlines today may be facing new challengers in coming years that are not yet on these companies’ radars—or their investors’ radars,” said Hady Farag, a BCG associate director, in the press release. “Take note of the up-and-coming companies around the world. They will likely be the next wave of new market entrants, competitors and acquirers.”

Other sectors that faired well in the study were aerospace and defense and health care services companies. Combined, stocks from these two sectors occupied five of the top 20 slots. (See also: What can cause the rate of return to be negative?)

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