THE BEST & WORST STOCKS OF 1993 REPORTER ASSOCIATES John Wyatt with Joyce E. Davis, Ani Hadjian, Rajiv M. Rao, and Ricardo Sookdeo
By Richard S. Teitelbaum REPORTER ASSOCIATES John Wyatt with Joyce E. Davis, Ani Hadjian, Rajiv M. Rao, and Ricardo Sookdeo

(FORTUNE Magazine) – It was the Chinese Year of the Rooster, but investors who ignored Chicken Little probably had something to crow about in 1993. Despite a relentless chorus of bearish prognosticators, the feisty American Stock Exchange surged 16.6% for the year, the over-the-counter market rose 12.1%, and even the lumbering Big Board was up a respectable 7.6%. Sure, there were disasters aplenty -- witness the great sell-offs in tobacco and health care stocks. But for every turkey, an eagle or two took its place. FORTUNE's annual list of best and worst stocks -- compiled with the help of Barra Inc., a Berkeley, California, investment service -- showcases the top 100 and the bottom 20 shares in the major U.S. markets. Stocks are ranked by total return -- price changes plus dividends -- through December 23. We omit partnership units, REITs, closed-end mutual funds, preferred stocks, and shares that began the year trading at less than $5 (before splits), as well as spinoffs, IPOs, and American depositary receipts. All of our winners posted a total return of at least 88%. Leading the pack was Wholesome & Hearty Foods, maker of the Gardenburger, a meatless hamburger that (surprise!) actually cures Big Mac attacks. It cooked up a sizzling 458% return in the OTC market this year as it planted its products in more and more restaurants and school cafeterias. Another well-received innovation -- the Big Bertha golf club -- sent Callaway Golf to the top of the Big Board heap with a 220% return. Eight companies made return appearances from last year's winners list. On the Big Board they included Promus, the casino operator; Timberland, the trendy hiking-boot maker; Fidelity National Financial, a title insurer; EMC, which makes storage products for computers; and Marvel Entertainment, the comic book publisher (SpiderMan). Oil and gas producer KCS Energy moves up from the OTC market. On the curb, encores were sung by Blount Inc., a chain- saw maker, and Clear Channel Communications, which owns TV and radio stations. But also on the Amex, Cognitronics, a maker of voice-processing equipment, goes from a 1992 best performer to a worst performer; Diagnostek, a health care company on the Big Board, went from worst to best. Discount retailer Value Merchants carries off a dubious honor: It's the only company to reappear on the worst-performers list. Among the winners, the communications industry comes in loud and clear. Tiny Andrea Electronics, producer of a telephone gadget that suppresses background ) noise, led the Amex with a 445% price run-up. General Instrument, International CableTel, and Dial Page were all plugged in too. Bulls bolstered discount brokers like Charles Schwab and Waterhouse Investor Services. What did the losers have in common? Some were fashion victims: Apparel manufacturers Leslie Fay and Bernard Chaus fell out of style, as did Merry-Go- Round Enterprises, once a highflying retailer. The bottom also fell out of Frederick's of Hollywood, purveyor of lingerie to the uninhibited everywhere. If Chinese astrology is any indicator, investors could end this year with their tails between their legs: It's the Year of the Dog. (For some possible winners nevertheless, see ''The Best Industries for Investors in 1994.'')

CHART: NOT AVAILABLE CREDIT: NO CREDIT CAPTION: A SOUND YEAR

CHART: NOT AVAILABLE CREDIT: Barra Inc. CAPTION: NEW YORK STOCK EXCHANGE THE 50 BEST THE 10 WORST

CHART: NOT AVAILABLE CREDIT: Barra Inc. CAPTION: OVER-THE-COUNTER EXCHANGE THE 25 BEST THE 5 WORST

CHART: NOT AVAILABLE CREDIT: Barra Inc. CAPTION: AMERICAN EXCHANGE THE 25 BEST THE 5 WORST