Local stocks begin year on a high note

The BizTimes Stock Index, which tracks the cumulative value of publicly held companies based in southeastern Wisconsin, rose an astounding 31.4 percent in 2010 and shows no signs of slowing down in 2011.

The local index began 2010 at 123.64 and ended the year at 162.50, flirting with a two-year high.

Of the 37 stocks in the index, all but six of them posted positive returns in 2010.

Eight of the largest gainers in the index in 2010 were manufacturers. The top 10 local stocks for the year were: Ladish Co., Twin Disc Inc., Strattec Security Corp., MGIC Investment Corp., Joy Global Inc., Bucyrus International Inc., Waterstone Financial Inc., Rockwell Automation Inc., Actuant Corp. and Johnson Controls Inc.

The stocks for Ladish and Bucyrus received a bump with the announcements that those companies will be acquired by larger corporations in 2011. Ladish will be acquired by Allegheny Technologies Inc., and Bucyrus will be acquired by Caterpillar Inc.

Meanwhile, Wisconsin’s largest bank, Marshall & Ilsley Corp., will be acquired by Bank of Montreal, the parent company of Harris Financial Corp.

Thus, with Ladish, Bucyrus and M&I all being sold to larger companies, southeastern Wisconsin will lose three corporate headquarters.

The stocks for most of the old-line manufacturers the region is known for performed well in 2010.

Racine-based Twin Disc is one of the world’s largest designer, manufacturer and distributor of power transmission equipment. The company’s products include marine transmissions, surface drives, propellers and boat management systems, as well as power-shift transmissions, hydraulic torque converters, power take-offs, industrial clutches and control systems. In its most recent quarter, Twin Disc’s earnings grew to $2.7 million from $2.4 million a year earlier.

Michael Batten, chairman and chief executive officer, said, “Demand for our oil and gas transmission systems continues to have a profound impact on our sales, profitability and backlog. This demand is being driven by positive market trends from customers in the oil and gas industry building high-horsepower rigs, where our transmission systems continue to be the industry leader for these kinds of applications. While much of our near-term momentum is tied to the 8500 transmission systems, we are continuing to invest and expand other areas of our business.”

Milwaukee-based Strattec is one of the world’s largest producers of automotive locks and keys. The company’s solid growth in 2010 reflected the rebound of the American automotive sector. In its most recent quarter, Strattec’s net income grew to $1.4 million from $943,000 a year earlier.

The only stocks to lose ground in the BizTimes Stock Index in 2010 were ZBB Energy Corp., Koss Corp., A.O. Smith Corp., Magnetek Inc., Orion Systems Inc. and Bank Mutual Corp.

The growth of the BizTimes Stock Index was reflective of the gains of the broader stock market in 2010.

For the year, the Dow Jones Industrial Average climbed 11 percent to 11,578, the S&P 500 grew 13 percent to 1,258 and the Nasdaq Composite rose 17 percent to 2,653.

The stock market continued to climb to two-year highs in January.