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Despite national economic challenges, Santa's Stock Portfolio(TM) is still optimistic

Amegy Bank of Texas and its investment analyst team provide an annual perspective on the U.S. Stock Market by tracking Santa's hypothetical stock portfolio, focusing on the performance of the companies that fall into the consumer discretionary and personal technology sectors, where Santa would have special insight.

HOUSTON, Dec. 19 /PRNewswire/ -- It's no secret that the economy has been rockier than Santa's flying sleigh. But while most investors have grown grey beards like Santa's after constantly worrying about the stock market, Santa Claus reminds the world that he knows how to ride out turbulent markets and still make wonderful Christmas memories for boys and girls around the world.

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Since 2002, Amegy Bank of Texas has tracked the yearly performance of a hypothetical list of stocks that Santa is likely to put on his wish list. Santa's Stock Portfolio(TM) includes 24 stocks from companies who are weathering the blustery holiday winds that are currently blowing through the American stock market. Although his stock portfolio is down 26.5% in total return (including reinvested dividends), these soggy numbers fare much better than the S&P 500 which is down 39.5% and the Dow Jones Industrial Average, which is down 33.6%.

Like most investors, Santa's portfolio has definitely taken a few hits from wayward elves who've been throwing snowballs out of worry and frustration that their toy factory jobs may be at stake during the current economy. But Santa is reassuring his elves that they, along with America, will survive these unprecedented financial times.

It has also been a Grinch-like year for Santa's investments and for his retirement funds, which have been dramatically affected. Consequently, Santa will have to push his retirement plans back a few more years, and needless to say, Mrs. Claus is not happy about this! She was looking forward to spending her Christmas tanning in Bermuda, not wrapped in a red Eskimo suit braving the frosty North Pole winds!

But Santa has weathered similar icy conditions and financial storms for decades, most notably the Great Depression and the banking crisis of the 1980s, just to name a few. And during both of those periods, Santa always managed to deliver children their prized baby dolls, toy soldiers and Atari gaming systems, respectively, right on time.

In order to continue making holiday dreams come true for Christmas 2008, Santa further diversified his portfolio by selling and replacing four of the 24 stocks. Based on these changes, it appears that the approximate 5-year equally weighted average total return for Santa is up 19.8%, versus the S&P 500 which is down 0.48% and the Dow Jones Industrial Average which is up 0.25%.

"Santa understands that these are tough economic times, but he also realizes that a resilient attitude, diversification and a heart for the children will see him, and his stock portfolio, through this period," said Paul Murphy, CEO of Amegy Bank of Texas. "Santa has reflected on his past to recall the lessons that he's garnered from weathering previous storms, which includes the importance of diversification and reading the letters of children to know which companies are popular year-to-year."

So how has Santa managed, once again, to maintain a holly jolly outlook and equally optimistic portfolio? By doing what he does best: constantly assessing and evaluating the "toys" in life that make people tick. It all began in late 2007 when Santa sensed a freezing economy, and maybe even a recession, after reviewing the Christmas 2007 shopping season. Even the wealthiest of the nation had begun to cut back on non-necessary expenditures, giving Santa a flashback into the mindset of Americans during tighter economic times. As a result, he reduced his investment exposure to higher-end and formalwear retailing (Tiffany, down 50.7% YTD in 2008; Nordstrom, down 66.0% YTD; Men's Wearhouse, down 52.1% YTD) and some expensive, discretionary purchase luxury items (Garmin, down 79.5% YTD). He even put away his personal "bling" and started wearing a sports watch rather than his beloved diamond studded watch.

In turn, Santa replaced these high end stocks with a lower ticket discount retailer (Ross Stores, up 9.0% YTD), a Do-It-Yourself auto supply retailer (AutoZone, up 7.6% YTD), a low priced entertainment production company (Marvel Entertainment, up 7.3% YTD) and a tasty "comfort food" snack retailer (J&J Snack Foods, down 2.7% YTD). In Santa's mindset, most Americans would stop living like there was no tomorrow and instead return to the frugality of previous generations, including shopping at Ross with a budget in mind, entertaining the kids at home with Marvel Entertainment's "Iron Man" DVD and enjoying a warm, tasty Cinnabun, courtesy of J&J Snack Foods.

"Santa looks at his portfolio between Christmas and New Year's every year and sells stocks, buys his new stocks and equally weighs the newly revised portfolio of stocks at the closing prices of the end of the year," said Mike Krach, Amegy Bank of Texas chief investment officer. "So Santa knew at the end of 2007 that tough economic times were coming, and he thought people would postpone buying luxury items and instead shop for off-price clothing, work on their own cars, and watch movies at home for entertainment. I think he was absolutely right in his assessment."

With that said, here are the five best investment performers that Santa can shout "Ho, Ho, Ho!" about:

Santa's Five Best Investment Performers for YTD 2008

Wal-Mart +17.1%
    Hasbro +9.4%
    Ross Stores +9.0%
    Tractor Supply +7.6%
    Auto Zone +7.6%

Contrarily, these dreary five have made Santa utter "Bah Humbug" like his famous archrival, Ebenezer Scrooge:

Santa's Five Worst Performers for YTD 2008

Macy's (-67.4%)
    GameStop (-62.8%)
    Energizer Holdings (-62.5%)
    Nokia (-59.0%)
    Google (-55.1%)

As the year comes to the end with investors continuing to be in limbo about the economy, Santa is resting his laurels on his faith that things will get better soon. He's survived difficult financial periods and unstable markets before, and he's learned that tough times will eventually melt away like Frosty the Snowman. However, smart investors on the other hand, will always withstand the tests of time like Santa and his reindeer. But more than anything, when Santa returns to the North Pole on Christmas Day and his elves deliver millions of reports about the smiles and giggles of children from all over the world as they unwrapped the gifts that they've always wanted, he will remember why he got into the Christmas business in the first place: to make holiday dreams come true.

    Santa's 2008 Stock Portfolio       YTD Return*
    Amazon.com                            (-47.3%)
    Apple Computer                        (-52.2%)
    Auto Zone                               +7.6%
    Best Buy                              (-54.8%)
    Dell                                  (-54.6%)
    Energizer Holdings                    (-62.5%)
    GameStop                              (-62.8%)
    Google                                (-55.1%)
    Hasbro                                  +9.4%
    Hershey                                 -7.2%
    J&J Snack Foods                        (-2.7%)
    Joseph A. Bank Clothiers               (-8.4%)
    Kohl's                                (-23.9%)
    Macy's                                (-67.4%)
    Marvel Entertainment                    +7.3%
    Mattel                                (-19.4%)
    Nintendo                              (-33.2%)
    Nokia                                 (-59.0%)
    PetSmart                              (-30.5%)
    Ross Stores                             +9.0%
    Tractor Supply Company                  +7.6%
    Wal-Mart Stores                        +17.1%
    Walt Disney                           (-28.4%)
    YUM! Brands                           (-25.0%)

    *YTD Return as of 12/15/08
    Source: Reuters StockVal, Bloomberg L.P.

The information shown is offered in the spirit of the season, and is not intended to be a true and accurate measure of any investment portfolio, nor should it be used to predict the future performance of the companies mentioned, implied or otherwise. It is not an offer, solicitation or recommendation of any kind.

About Amegy Bank of Texas

Amegy Bank of Texas is one of the fastest growing banks in Texas. With assets of more than $11 billion, local decision making and a history of relationship banking, Amegy has the resources to serve leading Texas companies as a source of capital as well as provide efficient and effective treasury management, international and investment services. The Bank, with more than 85 locations in the state, specializes in commercial banking as well as private financial management and trust services for families and individuals, and retail and mortgage banking services. Amegy is a part of the Zions Bancorporation (Nasdaq: ZION) collection of great banks.

SOURCE Amegy Bank of Texas