Valley Index Stocks Soar 42%, More Than Dow’s 33% Increase

While Wall Street turned in its best showing since 1975 with the Dow Jones Industrial Average jumping 33% in 1995, the Valley Index of local stocks fared even better, soaring 42% in their composite value last year.

Of 99 public companies operating in the San Fernando and Santa Clarita valleys and Ventura County, 60 stocks climbed in value last year, two were unchanged and only 37 declined, according to data compiled for The Times by Media General Financial Services in Richmond, Va.

The best performing local stock last year was Semtech Corp., a Newbury Park semiconductor concern whose latest quarterly profits jumped sixfold on a doubling of its sales, thanks to strong demand from clients in the computer, telecommunications and automotive industry. That growth was reflected in Semtech’s stock price, which climbed 641% last year and closed the year at $19.50 a share.

Indeed, six of the 10 best local stocks were communications and electronics concerns, including California Amplifier, a Camarillo maker of wireless cable TV components that is shifting gracefully from defense to commercial markets, and whose quarterly profits doubled recently thanks to a $7-million contract in Thailand to help thwart cable-TV pirates. That helped to drive up California Amplifier’s stock, which nearly quadrupled in 1995, and closed the year at $28.25 per share.

Eltron International, a Simi Valley maker of bar code label printers, saw its stock jump 259% last year; Vitesse Semiconductor in Camarillo, maker of high-performance gallium arsenide semiconductors, enjoyed a 149% rise in its stock price; Diodes, a Westlake Village semiconductor products supplier, saw its stock run up 110%; and MRV Communications, a Chatsworth maker of fiber optic and semiconductor devices, rose 109% in value.

Just missing the local top 10 stock list was Amgen Inc. in Thousand Oaks, the world’s most profitable biotechnology company, with expected 1995 profits of $525 million, and all that wealth generated from only two drugs.

After several fallow years of research, investors are now encouraged by a quartet of potential drugs that Amgen is working on, including one called MGDF that triggers the production of blood platelets and may help cancer patients undergoing chemotherapy to stop bleeding and hemorrhaging. MGDF is being tested now on humans and the early results are encouraging, company officials have said. Last year Amgen’s stock climbed 101%, to close at $59.38 per share.

Another company that enjoyed a good year was 20th Century, the Woodland Hills insurer that nearly went out of business after getting hammered with $1 billion worth of damage claims from the Northridge earthquake.

Most of those claims were from homeowners, and last year 20th Century saw its last homeowners quake policies expire, thanks to an exit scheme worked out with the state Insurance Commissioner; that, plus a major financial infusion from American International Group, a New York insurer that is now 20th Century’s biggest shareholder, enabled the company to get back to basics and just write auto insurance policies.

This year, 20th Century plans to branch out of California for the first time and start competing in the Arizona auto insurance market. The turnaround in the company’s fortunes was reflected in 20th Century’s stock, which climbed 89% and closed out 1995 at $19.88 a share.

At the other end of the spectrum was Hamburger Hamlet, the Sherman Oaks-based restaurant chain whose gourmet burgers have been part of Southern California’s culinary scene since the 1950s. But at year’s end, one share of Hamburger Hamlet’s stock wouldn’t even pay for a Big Mac. Hamburger Hamlet filed for Chapter 11 bankruptcy protection and its stock closed the year at a paltry 63 cents per share, down 86% for 1995, the worst showing by any local public company.

Hamburger Hamlet’s fortunes have been slipping since the restaurant’s founders sold the chain in the late ‘80s, and several management teams since then have been unable to keep pace with other trendy themed-restaurant chains, such as Cheesecake Factory, based in Calabasas, whose stock climbed 37% last year.

Another sad showing was put in by Incomnet Inc., the Woodland Hills long distance telephone company, whose stock was nearly dropped from Nasdaq last year.

The resignation of Incomnet’s chief executive, Sam Schwartz, and his replacement by Melvyn Reznick enabled the company to keep its Nasdaq listing. Schwartz attracted attention last summer when it was revealed that he’d been maintaining a fund through a separate company to try to shield Incomnet’s stock prices from short sale by speculators. Still, it was a gloomy time for Incomnet shareholders, as the stock plummeted 66% and closed the year at $4.56 per share.

And Positive Response Television, a Sherman Oaks producer of infomercials, had a negative response from Wall Street last year as the company’s sales disappointed and its stock tumbled 51%, to close the year at $8.88 per share.

Since the 1920s, the average annual gain in the Dow Jones average has been 9%, that after the Depression, four wars, numerous recessions and several stock market crashes. By any yardstick, last year’s 33% jump in the Dow average was a terrific showing, but for Valley area stocks, it was even more memorable.

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10 Best Performing Regional Stocks in 1995

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Closing price on Percent change for Stock 12/31/95 the year Semtech $19.50 +641 California Amplifier $28.25 +304 Eltron International $35.50 +259 Chad Therapeutics $15.63 +198 Vitesse $12.75 +149 Semiconductor 3-D Systems $23.75 +135 Right Start $4.94 +132 Premiere Radio $16.75 +131 Network Diodes Inc. $10.50 +110 MRV Communications 25.38 +109

Stock Line of business Semtech Semiconductors California Amplifier Communications Eltron International Bar codes Chad Therapeutics Medical Vitesse Semiconductors Semiconductor 3-D Systems Designs Right Start Baby products Premiere Radio Radio Network Diodes Inc. Electronics MRV Communications Computers

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Note: Excludes stocks whose Jan. 1, 1995, price was below $2 a share

Source: Media General Financial Services Inc., Richmond, Va.

10 Worst Performing Regional Stocks in 1995

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Closing price on Percent change for Stock 12/31/95 the year Hamburger Hamlet $0.63 -86 Styles On Video $0.50 -83 Janex $1.19 -73 International Variflex $7.00 -67 Incomnet $4.56 -66 Micropolis $3.75 -58 Reddi Brake $2.38 -52 Supply Harmony Holdings $1.63 -52 Positive Response $8.88 -51 Television K-Swiss Inc. $10.88 -45

Stock Line of business Hamburger Hamlet Restaurants Styles On Video Video Janex Children’s products International Variflex Sports equipment Incomnet Communications Micropolis Computers Reddi Brake Auto parts Supply Harmony Holdings Entertainment Positive Response Infomercials Television K-Swiss Inc. Sneakers

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Note: Excludes stocks whose Jan. 1, 1995, price was below $2 a share

Source: Media General Financial Services Inc., Richmond, Va.