The Innovation Index surges to 7%, beats major U.S. indices

The Innovation Index surged in the first week of April, and is now up 7% through April 5, 2007. The Innovation Index leads the major U.S. indices. S & P 500 also gained ground last week and is now up 2% for the year; NASDAQ rebounded as well and is now up 2% for the year; the Dow Jones Index gained 2% for the week, and is now up 1% for the year.



The Innovation Index closed at 74.10 on April 5, 2007, up 7% from the closing price of 69.31 on December 29, 2006.

The first week of April 2007 was phenomenal for the Top 20 Innovators: 16 of the Top 20 Innovators showed positive gains, only 1 of the Top 20 Innovators was in the negative territory, and 3 Innovators were unchanged last week.

Weekly Advances

Research In Motion Limited (NASDAQ: RIMM) (RIM) led all innovators with 7% gain for the week. RIM is now up 14% for the year, and importantly having a double-digit gain for the year. Can RIM come close to the 94% runaway performance of 2006?

Amazon.com, Inc. (NASDAQ: AMZN) had a solid first week in April, and gained 5%. Amazon.com is looking good at 6% gains for the year, and is poised to post double-digit gains for 2007 barring any revenue and profit setbacks. This would be a welcome change for Amazon.com investors.

Hewlett-Packard Co. (NYSE: HPQ) gained 4% last week, and is now up 1% for the year. HP's first quarter stock performance was up, down and sideways; however, HP is a tech bellweather, and a top innovator. Expect double-digit gains for the year.

America Movil (NYSE: AMX) tagged another 4% and is now up 10% for the year; the Mexican company is doing well by acquiring or obtaining stakes of overseas Wireless and Telco operators, and gaining subscribers.

Google Inc. (NASDAQ: GOOG), Southwest Airlines Co. (NYSE: LUV), Target Corp. (NYSE: TGT) and Wal-Mart Stores, Inc. (NYSE: WMT) each gained 3% last week.

Weekly Declines

General Electric Co. (NYSE: GE) was the lone decliner last week by a mere 1%. GE is down 6% for the year. Is GE undervalued despite all the innovations and revenue gains?

Yearly Leaders and Laggards

Yahoo! Inc. (NASDAQ: YHOO) leads all innovators with 25% gains for the year, and we are only in April. At this rate, can Yahoo gain 50% in 2007? It is quite possible. RIM is up 14% in 2007. eBay Inc. (NASDAQ: EBAY) and Apple Inc. (NASDAQ: AAPL) are each tied with 12% gains. Considering that we are only in April, it is possible that these innovators can have breakthrough performance in 2007. Starbucks Corporation (NASDAQ: SBUX) is down 11% for the year.

About The Innovation Index

The Innovation Index introduced in December 2006 is a weighted stock price index of the top 20 Innovators in North America.

The Innovation Index has returned 119% over the last five years. This assumes an investment in each stock of The Innovation Index (buying each stock). An average of $100 invested in The Innovation Index on December 31, 2001 returned $219 as of December 29, 2006. By comparison, $100 invested in each of S & P 500, NASDAQ and Dow Jones Index returned $124. The Innovation Index beats the S & P 500, NASDAQ and Dow Jones Index by 77% over the last five years.

The Normalized Innovation Index has returned an impressive 174% over the last five years. This assumes equal investment in each stock of The Innovation Index as of 2001.

Alphabetical list of the top 20 Innovators of The Innovation Index and their stock ticker symbols:

3M Company - (NYSE: MMM)
Amazon.com, Inc. - (NASDAQ: AMZN)
America Movil - (NYSE: AMX)
Apple Inc. - (NASDAQ: AAPL)
Cisco Systems, Inc. - (NASDAQ: CSCO)
Dell Inc. - (NASDAQ: DELL)
eBay Inc. - (NASDAQ: EBAY)
General Electric Co. - (NYSE: GE)
Google Inc. - (NASDAQ: GOOG)
Hewlett-Packard Co. - (NYSE: HPQ)
Intel Corporation - (NYSE: INTC)
International Business Machines Corp. - (NYSE: IBM)
Microsoft Corporation - (NASDAQ: MSFT)
Research In Motion Limited - (NASDAQ: RIMM)
Southwest Airlines Co. - (NYSE: LUV)
Starbucks Corporation - (NASDAQ: SBUX)
Target Corp. - (NYSE: TGT)
The Proctor & Gamble Company - (NYSE: PG)
Wal-Mart Stores, Inc. - (NYSE: WMT)
Yahoo! Inc. - (NASDAQ: YHOO)

The Innovation Index will analyze the positions and standings of the top 20 Innovators at the end of each year. For 2007, there will be no further changes in The Innovation Index.

Disclaimer: I invest in the stocks comprising The Innovation Index.

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