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It was a year when weight-loss drugs began to go mainstream, a year when technology and media companies were forced to grow up and a year when cryptocurrency experienced both a reckoning and a rebound.
Perhaps most of all, though, it was a year when you would have had to work pretty hard to avoid hearing about artificial intelligence.
Investors, as usual, scrambled for plays on the hot trends, and that translated into nice gains for technology stocks like Nvidia Corp.
NVDA,
and Meta Platforms Inc.
META,
— the S&P 500’s
SPX
two biggest winners — as well as crypto plays like Coinbase Global Inc.
COIN,
whose shares almost quadrupled over the course of 2023.
Other stocks generated buzz for the wrong reasons. Anheuser-Busch InBev
BUD,
learned a lesson about modern marketing when its Bud Light campaign featuring a transgender influencer backfired. Its shares lagged the S&P 500 this year, as did those of Walt Disney Co.
DIS,
whose struggles to generate hit films and turn a streaming profit illustrate the broader challenges facing media companies today.
It’s safe to say that Nvidia, Disney, GameStop Corp.
GME,
and many of the other names that MarketWatch has deemed among 2023’s most buzzworthy will stay firmly in the conversation during 2024 as well. But whether their stocks are due for repeat performances remains an open question. Nvidia, for example, will have a harder time posting explosive sales growth after its eye-popping 2023 revenue totals.
Here’s a look at what MarketWatch staffers and readers consider to be 2023’s most talked-about stocks, and the key issues that will drive their performances in the year to come.
Nvidia’s ascendance
This was Nvidia’s year, and everyone else was just playing for second place. While other companies talked up their potential in AI, Nvidia turned the hype into serious cash. The company continues to crush its own revenue records, more than tripling its top-line total in the latest quarter. Shares, meanwhile, are up 226% this year to easily pace S&P 500 gainers. So far, no one can catch Nvidia when it comes to supplying chips essential for training AI models. Even Nvidia is struggling to meet demand. But rival Advanced Micro Devices Inc.
AMD,
is coming for this lucrative market, so Nvidia will face more competition next year as it tries to replicate its spectacular growth.
Zuck grows up
Mark Zuckerberg’s Year of Efficiency at Meta translated into an efficient year of gains for investors. After shares of the Facebook parent company lost nearly two-thirds of their value in 2022, making for their worst year on record, they’re on track for their best-ever annual performance in 2023, up 179%. Zuckerberg led the way for the tech sector in reining in costs that ballooned during the pandemic as he slashed staff and pulled back on exuberant employee perks. Yet Meta’s 2023 story was about more than just cost cuts, and in that sense, Zuckerberg was back to his trademark ways. Wall Street once fretted about TikTok’s growing relevance, but Zuckerberg and his team have quelled those fears by again proving their ability to compete against the new hot thing with a copycat product. Reels is gaining traction with users — and becoming a solid moneymaker that should shine in 2024 as well.
Weight loss and stock gains
The new class of weight-loss drugs called GLP-1 medicines has attracted major buzz this year and chalked up handy gains for Eli Lilly & Co.
LLY,
and Denmark’s Novo Nordisk
NVO,
The latter is the developer of Wegovy and Ozempic, while Eli Lilly is behind Mounjaro — all medicines that mimic the effects of a gut hormone that helps control appetite and blood-sugar levels. Their popularity has at times created shortages of the drugs, which are injected. Many drug companies are working to create oral versions, which is expected to be a game-changing breakthrough that could come in 2024. Eli Lilly’s stock has gained 59% in the year to date, buoyed by excitement about its GLP-1 pipeline and hopes for an Alzheimer’s treatment that its chief medical officer is “extremely optimistic” about, as he explained to MarketWatch in an interview.
Novo Nordisk’s American depositary receipts, or ADRs, are up 41% in the year to date, and it has become the most valuable company in Europe at a market capitalization of about $430 billion. However, another play on weight loss has captured more gains this year than either of the two big drugmakers: Shares of WW International Inc.
WW,
formerly known as Weight Watchers, have gained 83% in the year to date after the company acquired digital telehealth company Sequence in March. Sequence can prescribe GLP-1 medications for its customers, boosting WW’s appeal with investors.
Teflon Tesla
Tesla Inc.’s stock
TSLA,
has lived up to its Teflon reputation, nearly doubling in value in 2023 despite ups and downs for the electric-vehicle maker and for Chief Executive Elon Musk. The year ends on a hopeful note, however, with Tesla launching sales of the Cybertruck in November. For bulls, the long-awaited, unconventional-looking electric pickup truck heralds more sales and better profit margins for Tesla. For bears, it’s a niche product that won’t move the demand needle. It just so happens that Musk seemed to side with the bears, seeking to temper expectations about the Cybertruck’s production ramp. Also this year, Tesla lost the steadying presence of Zach Kirkhorn, who stepped down in August as chief financial officer and as “master of coin,” potentially leaving Musk more open to trouble. True to form, the techno-king of Tesla found his way into several controversies this year, including endorsing an antisemitic tweet and dropping the F-bomb in public when speaking about big advertisers who are quitting his X social-media platform (formerly know as Twitter) in droves.
Survival of the fittest?
For cryptocurrency companies, 2023 wasn’t exactly a banner year. The Securities and Exchange Commission shut down Kraken’s staking program and sued Coinbase for operating an allegedly unregistered securities exchange. FTX’s Sam Bankman-Fried was found guilty of fraud, and Binance’s Changpeng Zhao pleaded guilty to money laundering. But despite it all, Coinbase shares have roared 298% higher on the year, riding a strong rebound in cryptocurrency prices. Admittedly, the stock is still off some 60% from its all-time high, trading volumes remain depressed and a regulatory cloud looms. Coinbase is positioning itself as the adult in the room, however, and that reputation may pay off in 2024 if rivals continue to struggle.
Microsoft wins minds
MarketWatch readers overwhelmingly chose Microsoft Corp.
MSFT,
as the buzziest of the four “traditional” Big Tech stocks this year. We agree. Microsoft’s investment in OpenAI helped its cachet earlier in 2023 as investors tried to figure out who was best positioned to capitalize on the AI frenzy. Now Wall Street is looking beyond the hype for businesses that can actually make money off AI in a reasonable time frame. Microsoft seems to fit that bill as well. Its Azure cloud business is showing better momentum than Google Cloud, which suggests that Microsoft is winning when it comes to AI workloads. But with shares up 56% this year and near record highs, future gains could depend on whether Microsoft’s software customers pay up for AI extras. That’ll be a 2024 story.
Namaste
Lululemon Athletic Inc.
LULU,
is MarketWatch’s top pick in the retail space, after its stock chalked up gains of 56% this year. That rally was enough to swell Lululemon’s market cap above $63 billion, making it about the same size as Target Corp.
TGT,
which is still a much bigger company as measured by sales.
Target’s 2023 sales are forecast at about $107 billion, while Lululemon’s are expected to come to $11 billion. But Lulu’s stock has benefited from mostly bullish analyst ratings on a company perceived as established yet still up and coming within athleisure, as Oppenheimer analysts said recently. The company’s recent Black Friday was its biggest sales day ever, it’s in good shape to expand internationally and it has a loyal, higher-income customer base, according to Truist analysts. Of the 31 FactSet analysts who cover the stock, 24 rate it a buy or equivalent, six rate it a hold and one has a sell rating.
Looking for the magic
Disney started the year with activist investors on its back, and despite many plot twists, it’s ending in the same spot. Screenwriters might call that coming full circle, but Disney’s story in 2023 has been anything but neatly wrapped up. CEO Bob Iger managed to shake off activists earlier this year when he announced job cuts and a business reorganization, but with shares near flat on the year, Trian Fund Management’s Nelson Peltz is reviving his calls for change. Disney has stumbled recently, dealing with film flops, leadership turnover and the continued erosion of traditional TV. The company faces hard choices heading into 2024, among them how to transition ESPN into the streaming world. The company will have to make these moves while dealing with an impatient investor base. The stock has eked out a meager 5% gain this year.
Bud’s a dud
In the beverages category, one stock was buzzy for a bad reason this year — a marketing campaign that went so awry it led to a boycott of the product. Anheuser-Busch InBev’s choice of a transgender influencer to promote Bud Light sparked a conservative-led boycott that saw musician Kid Rock film himself shooting at empty beer cans. The furor began after a brief promotional partnership with Dylan Mulvaney that irked the company’s more blue-collar customer base, some of whom accused the company of being “woke.” The fallout continues. Rivals, including Molson Coors Beverage Co.
TAP,
have picked up market share in beer, and one analyst believes Molson will be able to retain it. Roth MKM analyst Bill Kirk said he expects the market-share shift to be “sticky and likely very profitable.”
From the archives (March 2023): ‘Woke’ is being used to describe everything and nothing. What does it actually mean?
Name your meme
When it comes to meme stocks, we decided to poll readers on X and Instagram to find the most buzzworthy, and the winner was GameStop. The videogame retailer’s stock has been volatile, quite naturally, down 17% in the year to date but up 22% over the last month. The company astonished sell-side analysts last week when it said it’s expanding its investment policy to include equities, a move called “alarming” by Wedbush’s Michael Pachter. “Investors have a myriad of investment vehicles available to them and therefore do not need GameStop to act as a mutual fund,” Pachter wrote in a note. The analyst said it’s hardly a vote of confidence if the company believes it can fare better by buying other stocks than its own.
Claudia Assis contributed.
