Maryland's publicly traded companies as a group had reason to celebrate on New Year's Eve - they ended 2004 with stock gains of 18 percent, double the Standard & Poor's 500 index.
The Sun-Bloomberg index, which tracks the stocks of 90 businesses based in the state, bumped downward until August and then rose quickly. Six companies posted increases for every four that didn't.
Half of the top 10 were high-tech or biotech companies. And more than half of the worst performers - like Ciena Corp. - ply their trade in those sectors, too. That's life in Maryland, which has worked to make a name for itself as a research-and-development state.
"Biotechs and technology companies are very volatile - they'll always have their ups and downs," said Aris Melissaratos, the state's secretary of business and economic development. "I think tech and biotech drove performance in 2004, and it's going to drive it in 2005."
The Sun-Bloomberg index closed Friday at 313.62, its high point for the year.
Its 18 percent increase since the closing bell on Dec. 31, 2003, beats the S&P; 500, up 9 percent; the Nasdaq composite index, up 8.6 percent; and the Dow Jones industrial average, up 3.2 percent.
Dan McHugh, president of Lombard Securities in Fells Point, credits luck of the draw rather than geography: It was a good year for financial and small-cap companies, and Maryland has a generous helping of both.
Most of the state's marquee companies did particularly well.
The stocks of investment firms Legg Mason Inc. and T. Rowe Price Group Inc. jumped 42 percent and 31 percent, respectively. Spice maker McCormick & Co. Inc. rose 28 percent. Power-tool maker Black & Decker Corp. rose 79 percent.
Investors pushed up stock values 53 percent for men's retailer Jos. A. Bank Clothiers Inc.; 7 percent for MedImmune Inc., maker of nasal flu vaccine FluMist; 8 percent for military contractor Lockheed Martin Corp.; and 12 percent for Constellation Energy Group Inc., one of the state's few Fortune 500 companies and the owner of Baltimore Gas and Electric Co.
The Sun-Bloomberg index, formed at the end of 1994, finished at its highest New Year's Eve closing. But it has yet to fully recover after the temporary euphoria of the dot-com craze. The index is 10 percent below its peak in March 2000.
Its best yearly gain was 2003, when it rose more than 40 percent after losses the previous three years.
In 2004, the index's top performer was Bethesda-based MobilePro Corp., a wireless technology and broadband telecommunications company once floundering so badly that three years ago it had to engineer a reverse stock split of 200 to 1.
Last year, its stock jumped from just under 3 cents a share to 21.6 cents, up 645 percent.
During that time, MobilePro acquired 14 companies and began producing revenue after none at all in 2003. It's not profitable yet - losses quadrupled in the third quarter because of acquisitions - but investors won't have to wait long, promised Jay O. Wright, MobilePro's chairman and chief executive.
"We're going to be profitable in 2005," he said.
Silver Spring biotech company United Therapeutics Corp. made the top 10 - with stock appreciation of 97 percent - because it turned profitable for the first time last year. It also won Food and Drug Administration approval for an intravenous version of its pulmonary arterial hypertension drug, Remodulin.
"If you look at the biotechnology universe, there aren't that many companies that are actually profitable," said Jay Markowitz, a biotech analyst at T. Rowe Price who follows the company. "Now I think investors are anticipating increased growth."
Other top performers included beleaguered chemical-maker W.R. Grace & Co., whose stock rose 430 percent on hopes that the Republican-controlled Congress will pass a national settlement of asbestos claims; designer-jean maker I.C. Isaacs & Co. Inc., whose stock increased 400 percent after the company become profitable after years of losses; and health care company Dialysis Corp. of America, which gave shareholders a two-for-one split at the beginning of last year and then watched its stock run up about 630 percent.
But last year was unpleasant for Medifast Inc. of Owings Mills, a weight-loss company that saw its stock slide 75 percent to $3.52, making it the Sun-Bloomberg worst performer of 2004. Net income was down 25 percent in the third quarter, which Medifast blamed in part on quadrupling insurance and legal expenses. It is fighting three lawsuits it calls "frivolous."
Other poor performers included formerly high-flying high-techs such as Manugistics Group Inc., a software company that saw its stock slide 54 percent last year, and Ciena, the computer networking provider whose stock slumped 49 percent.
Sinclair Broadcast Group Inc., a television broadcasting company that faced controversy by planning to air a program critical of Sen. John Kerry shortly before the presidential election, also secured a place in the bottom 10 with a stock slide of nearly 40 percent.
And Spherix Inc., a Beltsville company with a call-center business and a sugar substitute called tagatose, has been fielding call after call from investors wanting to know why the stock plummeted 50 percent last year.
"We don't really know why," said Richard C. Levin, Spherix's acting president and chief executive. The company lost a federal contract for national parks reservation services but recently won its protest.
The biggest problem for Spherix appears to be inaction: the Danish firm to which it licensed tagatose has yet to build a large plant to produce the sweetener.
Maryland businesses ought to do well on the whole this year, said Daraius Irani, director of applied economics at RESI, Towson University's consulting arm. A growing number are tapping into defense and homeland security, markets with a funding supply conveniently located next door in Washington.
"They are well-positioned to reap the rewards," Irani said.