The big winners on the sharemarket

Anyone who invested $1000 in A2 Milk five years ago would have an investment worth $25,560 now, data from NZX Data and Insights shows.

It has revealed the best and worst-performing equities on the local market over the past one and five years. A2 Milk is the standout over five years, with a 2556 per cent total return, which assumes that any dividends have been reinvested.

It was followed by Pushpay Holdings, with a 498 per cent total return, Just Life at 554 per cent and Fisher & Paykel Healthcare, at 450 per cent.

Southern Cross Financial Group was the worst-performing over five years. Its share price fell from $0.24 to $0.002 over five years, down 99 per cent, followed by Sky Network Television down 93 per cent and Snakk Media down 94 per cent.

Over a one-year term, Me Today has returned 1660 per cent. This is not clear-cut, though – the health and wellness company had its sharemarket beginnings through the takeover of shell company China Scrap Metal and was renamed before a reverse listing in March.

It was ahead of Smartpay Holdings at 269 per cent and Blackwell at 250 per cent.

Sky was also a poor performer over one year, down 77 per cent.

Mark Lister, at Craigs Investment Partners, said there was no clear trend that had driven the outperformers.

Pushpay and Fisher & Paykel Health were international growth companies and other strong performers such as Chorus – which had a total return of 308 per cent over five years – were ‘‘safe and steady’’ infrastructure.

New Zealand’s market’s size meant movements were often on a case-by-case basis, he said. ‘‘The market here is quite small so it’s more difficult to make broad judgements about trends … a lot of the sectors are one or two businesses.’’

Businesses that were delivering growth or steady returns would be popular in an environment of falling interest rates, he said. ‘‘Businesses that can deliver steady earnings and dividend growth will continue to do well.’’

So too would those that delivered higher risk and higher return growth, he said.

‘‘Quantitative easing and low interest rates generally will push up prices in the housing market and sharemarket. Anything that generates a return or an income looks highly attractive.’’

That situation was likely to continue until the central banks changed approach, he said.

Sam Trethewey, Milford Asset Management portfolio manager, said the NZX as a whole had had a ‘‘huge tailwind’’ behind it over the past five years because of falling interest rates and quantitative easing around the world.

He said the scale of the interest rate drop was unlikely to be repeated to the same extent in future – and some of the growth companies that had ridden waves of success had achieved a lot of what they set out to do and had become large global businesses. To see the same growth repeated would require other companies to deliver the same sort of growth.

Simplicity founder Sam Stubbs said the market had been wellsupported by interest rates dropping. There was less room to move in the next five years, he said.

‘‘It will be harder for markets to go up, but they should be wellsupported by interest rates over the long term.

‘‘Fees will really, really matter, and be the biggest differentiator. A 1 per cent fee might be 50 per cent of returns.’’