The Most Successful Stock Of All Time

It's unwise to put too much stock (no pun intended) into the stock market. While there are broad correlations between stock market returns and GDP growth, trading stocks isn't the whole of the economy. It's an expectations game, based on where investors think a company's earning potential is headed. Still, the rise and fall of stocks is a regular feature of economic news, and which stocks are hot can tell you something about a company's stability and anticipated long-term relevance.

Guessing the highest-performing stock in the short term engages a certain class of investors, and long-term performance appeals to those looking for reliable investments or a sense of a company's history. For historians and the curious, it's fun to see the list of companies to reach all-time high stock prices unadjusted, an eclectic bunch of firms. But for investors, it's important to remember that a high stock price doesn't necessarily guarantee a company's qualities, and the price itself is a less reliable indicator than market capitalization (i.e., stock price times the number of outstanding shares). And then there's the question of performance: its total returns over a period of time. (See the best and worst stock predictions in U.S. history.)

The ideal performance depends on what an investor's looking for, so defining the most successful stock can be an individual matter. The question is further complicated by mergers and acquisitions. But looking at its return on investment, the highest-performing stock in the last 50 years is Altria Group Inc., the parent company of Marlboro. As reported by CNN at the time, in 2015, one dollar invested in Altria in 1968 yielded $6,638. That's equal to an annual return of 20.6% for some 47 years.

With the definition of a successfully performing stock varying by investor wants and needs, Altria Group Inc. can't be said to rank at the top of every list and chart of stocks. It's also a company tied up in a history of acquisitions and name changes; until 2003, it was known as Philip Morris, a name still used by its spun-off international branch. But CNN in 2015 branded Altria "the most successful company in the world" based on its 20.6% annual return over nearly 50 years.

The factors that make it so are, admittedly, not the most admirable. For one thing, the company's wealth is built on an addictive product implicated in severe health issues. Even as tobacco use in the United States has declined, foreign territories remain lucrative markets. By the nature of the product, there's little need for Altria to spend money innovating new, potentially risky ventures, though Altria did invest some $12.8 billion over four years in e-cigarette maker JUUL Labs, before exiting the partnership in 2023 (its 35% stake in 2018 was worth 3.5% by 2022). Not to mention, the rate of inflation for the price of tobacco products is historically higher than the overall rate.

Ironically, the negatives associated with tobacco have helped Altria's performance. Because the product is such a toxic asset for a large number of investors, those who do invest are able to enjoy high-dividend yields due to the low valuation of the stock. (Speaking of which, here are tips for investing in stocks as a beginner.)

CNN based its 2015 assessment of Altria Group Inc. as the most successful stock ever on a half-century of evaluation. However, using shorter time frames, other companies have rivaled and even outpaced Altria's performance. Based upon 20-year trailing returns (i.e., return on investment over a defined span of time), four companies offered a higher return as of 2020. (By the way, don't make these mistakes when the market is at an all-time high.)

Of these, the strongest performer was Monster Beverage Corp (NASDAQ: MNST). The company dates back to the 1930s, when it was known as Hansen Natural Corporation and sold non-pasteurized fruit juice. Its products stayed within that vein for decades, but in 1990, Hansen was purchased by Rodney Sacks and Hilton Schlosberg and was retooled to focus on energy drinks. Hansen launched its now-ubiquitous Monster brand in 2002 and took off. Monster became the company's name after 2012, reflecting its biggest earner. As of 2021, its stock price had shot up 111,929% over 20 years, and its trailing return had reached 87,560%. To compare, Altria's was 9,620%.