Despite rising by a rather impressive 33% in the last five years, there are a number of stocks that have outperformed the FTSE 100 since the middle part of 2010. Notably, and impressively given the challenging trading conditions for its sector, Lloyds (LSE: LLOY) (NYSE: LYG.US) is one of those companies, with its shares having soared by 58% in the same time period.
Of course, Lloyds has benefitted from the sale of the UK government’s stake, which has undoubtedly improved investor sentiment in the stock. That’s because it has shown that Lloyds is viable as a standalone entity and has the financial strength and financial performance to go it alone without taxpayer-backed funds. And, the central reason that has allowed the sale of the government’s stake is a superb strategy of de-risking the bank’s balance sheet while at the same time improving the efficiency and performance of its core business units.
A direct result of this has been a return to profitability and a profit outlook that is relatively encouraging. Yet, despite this, Lloyds continues to trade on a relatively low valuation, with evidence of this being offered by a dividend yield that, at its current share price, is set to hit 4.9% next year. As a result, it would be of little surprise for Lloyds to see its share price rise over the medium term, as investors seek to buy into its continued resurgence. Therefore, now seems to be a great time to buy a slice of it.
Also outperforming the FTSE 100 in the last five years is easyJet (LSE: EZJ). Its shares have risen by a hugely impressive 281% and, looking ahead, further growth looks set to be on the horizon. A key reason for this is a recovering global economy, with demand for passenger jet tickets continuing to increase and, alongside easyJet’s excellent strategy on business passengers, its future growth rate is set to drive the company’s share price higher.
In fact, easyJet is forecast to increase its bottom line by around 11% per annum over the next two years and, with its shares trading on a price to earnings (P/E) ratio of 13.2, it appears to offer significant scope for an upward rerating in 2015 and beyond.
Meanwhile, cruise ship operator, Carnival (LSE: CCL) (NYSE: CCL.US), has also beaten the FTSE 100 in the last five years. Its shares are up by 56% during that time and, looking ahead, its stunning earnings growth forecasts are likely to push its shares significantly higher. For example, Carnival’s bottom line is expected to rise by 60% in the current year, followed by 29% next year.
Clearly, that’s well ahead of the wider index’s growth rate and, despite this, Carnival trades on a price to earnings growth (PEG) ratio of just 0.6. This indicates that its shares offer growth at a very reasonable price and look set to continue the run over the last year that has seen them rise by a whopping 62%.
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Peter Stephens owns shares of easyJet and Lloyds Banking Group. The Motley Fool UK has no position in any of the shares mentioned. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.