FTSE 100's 10 biggest winners and losers of 2018

After an extraordinary year for UK blue-chips, and with 2019 promising more of the same, Graeme Evans reveals the best and worst stocks of the past 12 months.

Asked to pick the biggest FTSE 100 winners for 2018, it's unlikely too many investors would have plumped for Pearson and Bunzl back in January.

But after a rollercoaster year in which banks such as Lloyds Banking Group and popular retail stocks have again fallen by the wayside, these two are currently in the blue-chip top 10 following gains of 27% and 15% respectively.

The pair are separated in our list by two heavyweights in the shape of GlaxoSmithKline and AstraZeneca, with the drugs rivals highlighting both their defensive qualities as well as recent efforts to improve performance.

This was shown by today's 6% jump for Glaxo shares as CEO Emma Walmsley announced long-awaited plans to spin off the blue-chip's consumer healthcare unit in a move that should also preserve the 80p a share annual dividend.

FTSE 100 newcomer Ocado is at the top of the list after a transformational year in which it secured a deal to supply its technology to America's second biggest grocer, Kroger. Shares peaked at 1,146p in the summer and are still 97% higher over 2018 despite a more subdued performance in recent weeks.

The rise of education publishing business Pearson is particularly impressive, given that it has been a heavy target for short-sellers during 2018. They received a bloody nose thanks to the strategy of John Fallon, whose focus on digital learning tools has offset pressure on Pearson’s US higher education division.

The shares are still some way short of the 1,492p seen in 2015, when Pearson was considered one of the best income plays in the FTSE 100. A hefty dividend cut followed, but the company now seems to be over the worst after a significant round of restructuring work.

Bunzl, meanwhile, has been going about its business steadily and efficiently in 2018. This has involved a steady stream of acquisitions and revenues growth of more than 8% as the support services business continues to demonstrate to investors its Brexit-defensive qualities.

FTSE 100 top performers in 2018

Source: SharePad        Prices as at 19 December 2018

The UK political and consumer turmoil is reflected in the list of FTSE 100 fallers, with the likes of housebuilder Taylor Wimpey and B&Q owner Kingfisher both losing more than a third of their value.

One of the biggest disappointments of the year as far as interactive investor clients are concerned has been the performance of mobile phone giant Vodafone, which is down 32% in 2018 to below 160p.

Recent half-year results have helped to steady the ship, however, with new boss Nick Read easing fears that a rising debt pile could jeopardise pay-outs from the most valuable income stock in the FTSE 100 Index.

His guidance prompted analysts at Barclays to speculate last month about an "end of the downgrades", with a price target of 220p. 

Royal Mail is another popular stock enduring tough times, with investors stunned by October's "kitchen-sink" update from new boss Rico Back when he cut the company’s annual cost savings target by 56%.

Shares are now comfortably below the 2013 IPO price of 330p, spelling bad news for small shareholders who may still have their 227 shares from the heavily oversubscribed flotation or been tempted by the 6% dividend yield.

With little sign of an upturn in fortunes, Royal Mail is now set to lose its blue-chip status in this month's quarterly reshuffle of the blue-chip index.

The biggest faller in the FTSE 100 is British American Tobacco, which has now fallen 49% in 2018 to a seven-year low. Declining volumes, the threat of regulation in the United States and the emergence of rival vaping products have put paid to tobacco's long run as one of the best performing sectors in the UK.

Fund manager Neil Woodford dumped BAT shares at £50 in 2017, with the stock now trading at 2,557p. But the maker of brands including Dunhill and Lucky Strike still has its supporters, with UBS naming BATS on its top picks list.

Micro Focus International is 45% lower, but this is still better than the 912p low seen in March after a savage profits warning triggered by difficulties with its £6.6 billion deal to buy software assets from Hewlett Packard Enterprise.

FTSE 100 worst performers 2018

Source: SharePad        Prices as at 19 December 2018

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.