These are the 5 BEST stocks of the year

Fresnillo Plc (LON: FRES), DCC plc (LON: DCC), Randgold Resources Limited (LON: RRS), Paddy Power Betfair PLC (LSE: BET) and Intertek Group plc (LON: ITRK) thrashed all-comers over the last year, but can they stay top dogs? Harvey Jones finds out.

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The FTSE 100 has fallen 12% since hitting an all-time of 7,103 almost exactly one year ago but not every company has been on a losing streak. The top five performers on the index have delivered returns of between 47% and 23% in that time, according to research from Hargreaves Lansdown.

So who are these fabulous five and can they maintain their winning streak?

Fresnillo

And the winner is
 Fresnillo (LSE: FRES). Perhaps it’s only fitting that a gold and silver miner should come first in last year’s medals placing. Its 12-month return of 47% simply couldn’t be beaten. This is only partly due to the rising price of  gold: growth was a modest 4.6% in the last year to $1,292 an ounce while silver did only slightly better, rising 5.6% to $17.81 an ounce.

Fresnillo’s share price really started flying in the middle of January’s market rout, and is up nearly 60% in the last three months on the weaker dollar and dash for safe havens. Its share price could go anywhere from here and this stock remains a glittering portfolio diversifier for today’s anxious investors. 

DCC 

International sales, marketing, distribution and business support services firm DCC (LSE: DCC) was last year’s runner-up growing 42%. This ambitious company is growing fast, having made two large acquisitions lately, Esso Retail France and Butagaz. In today’s troubled markets it’s good to hear bullish management predicting that “both operating profit and adjusted earnings per share will be very significantly ahead of the prior year.

Earnings per share (EPS) leapt 25% in the year to March and although it’s set slow to around 10% this year, that still looks promising. You pay a premium for DCC’s bright growth prospects, in this case more than 30 times earnings. DCC’s recent momentum suggests this may be a price worth paying.

Randgold Resources

In third place sits gold miner Randgold Resources Limited (LON: RRS), its share price up 31% in the last year, helped by market volatility, a dovish Fed and the weaker dollar. Randgold’s annual gold production exceeds 1m ounces but it has been successfully replenishing reserves as they deplete. Again, performance is subject to gold price swings, which nobody can control, but the diversification benefits are clear.

Paddy Power Betfair

International multi-channel betting and gaming group Paddy Power Betfair (LSE: BET) rose 29% in the last year. The merged company will need no introduction to anybody who has seen a Premier League game on Sky lately, as gaming adverts seem to take up more time than the actual match.

The share price has fallen 20% in recent weeks but Morgan Stanley says this is a great buying opportunity. It’s hardly a cheap one, trading at more than 33 times earnings, so you’re still playing for high stakes. 

Intertek Group

Last but by no means least, Intertek Group (LSE: ITRK) returned 23% last year. 2015 wasn’t all good for the inspection & testing services specialist, which enjoyed a 4% rise in profits to ÂŁ323m and 20 basis point rise in margins to 15.9%. But it also suffered a £308m pre-tax loss, primarily due to a non-cash impairment charge of ÂŁ577m. It looks expensive at 23.2 times earnings but once again, that’s the price of success.

RISK WARNING: should you invest, the value of your investment may rise or fall and your capital is at risk. Before investing, your individual circumstances should be assessed. Consider taking independent financial advice. The Motley Fool believes in building wealth through long-term investing and so we do not promote or encourage high-risk activities including day trading, CFDs, spread betting, cryptocurrencies, and forex. Where we promote an affiliate partner’s brokerage products, these are focused on the trading of readily releasable securities.

Harvey Jones has no position in any shares mentioned. The Motley Fool UK has recommended Hargreaves Lansdown, Intertek, and Sky. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.

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