But before looking for stock-picking opportunities that will pay off in the next ten years, a look back at the big winners of the past decade is instructive. Here are the 10 best S&P 500 constituents since Dec. 31, 2000, according to data provided by Capital IQ. They are ranked in reverse order by share-price appreciation.
10. Intuitive Surgical
10-Year Gain: 1,429%
Company Profile: Sunnyvale, Calif.-based Intuitive Surgical designs, manufactures and markets the da Vinci Surgical Systems, a robot-assisted surgical device that enables surgeons to perform complex procedures, such as open-heart surgery, through one-to-two centimeter incisions.
Analyst Ratings: Intuitive Surgical receives strong grades from analysts. Of the 15 researchers covering the stock, seven recommend the stock as a "buy" and the other eight say investors should hold onto shares.
Major Events: Shares of Intuitive Surgical finished at $17 at the end of 2000 and rallied to an all-time high of $394 earlier this year. The company launched its initial public offering in 2000, right as its da Vinci Surgical System became the first robotic surgical system cleared by the FDA for general laparoscopic surgery. Litigation between Intuitive Surgical and principal competitor Computer Motion held back shares of the company until a 2003 merger between the two providers of robotic-assisted surgical systems.
In following years, the FDA approved the da Vinci Surgical System for thoracoscopic surgery, for cardiac procedures performed with adjunctive incisions, urologic and gynecologic procedures.
Upside Potential: Analysts have an average price target of $322, which implies that shares can rise 24% from where they currently trade at $260.
9. Coach 10-Year Gain: 1,497%
Company Profile: Coach is a well-known luxury name for leatherwear in the U.S. The New York-based company's product offerings include handbags, women's and men's accessories, footwear, business cases, jewelry, travel bags, fragrance and watches.
Analyst Ratings: Like its handbags and leather gloves, Coach shares are in high demand with analysts. Thirteen of the 17 researchers covering the stock rate Coach a "buy." The rest say investors should hold onto shares.
Major Events: A decade ago, one share of Coach could be purchased for $3. Most items in Coach's retail stores are priced 50 times higher. Until 2000, Sara Lee owned Coach before launching an IPO to sell a 17% stake in the company. A year later, Sara Lee spun off its remaining interest in Coach.
The company has continued to open retail and boutique stores over the past decade. Coach operates more than 400 stores in the U.S. and Canada and Coach boutiques located within select department stores and specialty retailers across the U.S. Coach has also made strides in the Asia-Pacific region, forming Coach Japan as a joint venture with Sumitomo in 2001 before gaining 100% ownership in 2005. The company also bought the Coach domestic retail businesses in Hong Kong, Macau and mainland China from its former distributor in 2009.
Upside Potential: Coach shares may wind up at $57.67, according to the average analyst price target, below the stock's current price of $57.96.
10-Year Gain: 1,653%
Company Profile: CarMax is primarily known as a used-car retailer in the U.S., but the company also has franchise agreements to sell new vehicles by Chrysler, Nissan, Toyota and General Motors.
Analyst Ratings: Of the 13 analysts covering CarMax, not one has a "sell" rating on shares. Nine researchers say investors should hold shares, while another four suggest buying the stock.
Major Events: Before 2001, shares of CarMax traded below the $2 mark as it was still under the ownership of the now-defunct electronics retailer Circuit City. CarMax was separated from Circuit City in 2002 and has seen sharp price appreciation during a time that most automobile-related companies have been hit hard.
CarMax claims the title of the nation's largest retailer of used cars, based on the 357,129 used vehicles retailed during the fiscal year ended Feb. 28, 2010. CarMax operates 100 used car superstores as of the end of fiscal 2010.
Upside Potential: Analysts have an average price target of $31.56 for CarMax shares, which is below the current price level of $34.67.
7. Cognizant Technology Solutions
10-Year Gain: 2,223%Report Typo/Error
- S&P 500 INDEX2,343.98-1.98(-0.08%)
- Apple Inc$140.64-0.28(-0.20%)
- Coach Inc$39.09+0.21(+0.54%)
- Cliffs Natural Resources Inc$8.14-0.22(-2.63%)
- Quintiles IMS Holdings Inc$77.99+0.52(+0.67%)
- Sprint Corp$8.50+0.04(+0.47%)
- New York Times Co$14.25-0.05(-0.35%)
- Gannett Co Inc$8.18+0.03(+0.37%)
- American International Group Inc$60.88-0.46(-0.75%)
- Citigroup Inc$58.07+0.02(+0.03%)
- Morgan Stanley$42.46-0.13(-0.31%)
- E*TRADE Financial Corp$33.64-0.10(-0.30%)
- Dow Jones Industrials20,596.72-59.86(-0.29%)
- Intuitive Surgical Inc$758.00+11.82(+1.58%)
- Carmax Inc$59.60-0.44(-0.73%)
- Cognizant Technology Solutions Corp$58.62-0.14(-0.24%)
- Southwestern Energy Co$7.56+0.02(+0.27%)
- Urban Outfitters Inc$22.94-0.06(-0.26%)
- FLIR Systems Inc$36.06-0.24(-0.66%)
- Priceline Group Inc$1,753.11+4.78(+0.27%)
- Expedia Inc$127.76+0.72(+0.57%)
- Updated March 24 4:00 PM EDT. Delayed by at least 15 minutes.