The county’s largest publicly traded companies have lost more than $30 billion in market value in Wall Street’s downturn this year.
The losses are across the board, with technology, healthcare, real estate and other companies each shedding billions or multimillions in value for the year through early December.
Four of the largest companies by market value have seen most of the losses. Combined, Allergan Inc., Broadcom Corp., Western Digital Corp. and Beckman Coulter Inc. have lost $20 billion.
Irvine drug maker Allergan, the county’s most valuable company, has lost $8 billion alone this year on concerns about falling demand for the company’s medical cosmetic products.
Broadcom, an Irvine chipmaker, has lost nearly $8 billion in value on worries about fewer sales of chips used in networking equipment, computers and consumer electronics.
Only a handful of the 50 or so local stocks tracked for the Business Journal by the Newport Beach office of Bank of New York Mellon Corp. have gains for the year.
The largest local stocks, as measured by the BNY Mellon Billion-Dollar Club index on page 14, are off about 35%.
The Billion-Dollar Club is down 40% for the year factoring in companies that fell off the index after their market values dropped below $1 billion.
That’s on par with the 40% decline in the Standard & Poor’s 500 index and Nasdaq.
There now are 13 companies in the Billion-Dollar Club, down from 19 at the start of the year. Falling off were Santa Ana-based Advanced Medical Optics Inc., Costa Mesa-based Ceradyne Inc., Emulex Corp. of Costa Mesa, Foothill Ranch-based Kaiser Aluminum Corp., Irvine-based Microsemi Corp. and San Clemente’s Sunstone Hotel Investors Inc.
Those companies now appear on the BNY Mellon OC 50 index of smaller stocks. The index, which tracks stocks with market values of $25 million to $1 billion, is down nearly 50% for the year, worsened by the decliners that joined from the Billion-Dollar Club.
The OC 50 saw 16 companies fall off after their market values dropped below the cutoff.
The BNY Mellon OC Tech index of local chip, software and computer products companies is off 45%. The makeup of the index is unchanged from January.
Western Digital
By percentage, the hardest hit major stock is Lake Forest disk drive maker Western Digital, down about 60% to $2.6 billion in market value.
Western Digital, one of the best stocks of 2007, is down on fears about lower demand in an industry known for profit-killing price wars in times of oversupply.
Santa Ana-based Ingram Micro Inc., the largest distributor of technology products, has seen its shares drop 40% to a market value of $1.8 billion.
The company is a barometer of corporate and consumer tech spending and recently gave a bleak outlook for the fourth quarter and into 2009.
Irvine chipmaker Microsemi took a wild ride last week as a controversy swirled around the education background of Chief Executive Jim Peterson (see Executive Summary, page 4). After two days of declines, Microsemi shares rebounded Friday, putting them down 40% for the year on a market value around $1 billion.
The only big local stock that’s solidly up is a turnaround play. Aliso Viejo-based drug maker Valeant Pharmaceuticals International is up 65% on a market value of $1.7 billion.
Investors have bid up the stock on efforts by Chief Executive J. Michael Pearson to restructure into a niche drug maker focused on licensing its products.
Edwards
Irvine-based heart valve maker Edwards Lifesciences Corp. was holding on to a 2% gain last week after coming off a big run-up earlier in the year. Edwards had a recent market value of $2.7 billion.
Santa Ana’s Corinthian Colleges Inc., an operator of vocational schools, was flat for the year on a market value of $1.4 billion. The company has seen increased enrollment from a downturn in employment.
Clothing makers and retailers have been among the hardest hit as consumers pull back spending.
Huntington Beach’s Quiksilver Inc. is off nearly 90% to a market value of $160 million as the seller of clothes inspired by surfing, skateboarding and snow sports struggles with debt. Some analysts say Quiksilver may have to put itself up for sale.
Anaheim-based Pacific Sunwear of California Inc., an operator of mall stores selling clothes from Quiksilver and others, has fallen nearly 90% to a market value of $110 million.
Foothill Ranch-based Wet Seal Inc., which runs mall stores for teen girls and young women, is flat for the year on a market value of $235 million.
Cost cutting and other moves have helped shore up profits as sales slip at Wet Seal. But future gains may be hard to come by as the company recently warned about profits and sales for the holiday quarter.
Not surprisingly, real estate brokerage and investment company Grubb & Ellis Co. of Santa Ana has been hit hard, losing more than 80% of its value to $75 million.
Big Gainer
The biggest percentage gainer among all stocks tracked by the Business Journal is Santa Ana-based Fuel Systems Solutions Inc., which is up 110% on a market value of $480 million.
The company has seen a run-up on growing sales and profits from conversion kits that allow vehicles to run on propane and natural gas. They’re big in Europe, where gas prices remain high because of taxes.
