13 lucky stocks break the scary ‘October jinx’

lived up to its jinxed reputation as a money-loser for most investors, but 13 lucky companies bucked the trend to turn this gloomy month into a glorious one.

Thirteen stocks in the Standard & Poor’s 500, including networking provider Akamai Technologies, Netflix and The Gap, posted 10% or greater gains just in October, according to a USA TODAY analysis of data from S&P Global Market Intelligence. These strong performances stood in stark contrast to the 1.9% decline set by the S&P 500 itself.

Investors go into October with an understandable amount of fear. October is known as the jinx month because many of the most infamous crashes have occurred during the month, including in 1929 (down 20.4%), 1987 (down 23.2%) and 2008 (down 14.1%), Stock Trader’s Almanac says.

Stocks did lose some momentum again this October as jitters over the election and the rising probability of an increase in short-term interest rates intensified.

Investors in October continued to shift their bets toward aggressive growth stocks and away from more “safe” dividend plays, as they look to profit even if the Fed boosts short-term interest rates, says Michael Farr, president of Farr, Miller & Washington.

Nonetheless, there were breakout winners, largely due to big surprises during earnings season.

Akamai was the October chamOctober pion. The company, which helps speed up Internet traffic, gained 31%. Investors were pleased when the company reported an adjusted quarterly profit of 68 cents a share, which topped expectations by 11%, S&P Global says. The bottom line rose 10% from the same period a year ago, which is the kind of growth investors are having trouble finding. Earnings for the S&P 500 are only expected to rise about 3% in the third quarter.

But when it comes to October earnings surprises, it’s hard to top Netflix. The video streamer saw its shares soar 27% during the month due to quarterly earnings that blew away estimates. Netflix reported an adjusted quarterly profit of 12 cents a share, which was double what Wall Street expected. The company earned 71% more in the just completed third quarter than in the same period a year ago.

It wasn’t just tech, though, that sidestepped October’s pain.

The Gap wound up powering 24% higher during October. The retailer, struggling to find its niche in a world where fashion players such as Forever 21 and H&M have sprouted up, is still seeing profits fall. The Gap reported an adjusted profit of 60 cents in the July quarter, which was down 6% from year-ago levels.

But the bottom line was almost 2% better than expected. Investors seem to be looking at other ways to profit, though. The Gap’s price-to-earnings ratio of 15 is below the more than 20 times valuation of the S&P 500. It also has a dividend yield of 3.4%, which easily tops the market’s roughly 2% yield.