Proof That Investing Your Tax Refund Will Pay Off

A tax refund can feel like a cash windfall, when in truth it simply means you’ve overpaid your taxes. That money is not a government handout — it’s money that was yours all along.

So, rather than going on a shopping spree when you get your refund, think about investing it for your future. Not convinced? Take a look at how much you would have made in less than a year if you chose to invest $2,782 — the average tax refund last year.

Click through to see how your portfolio can increase with the right fast-growing stock market winners.

Stock Price on April 17, 2017: $24.11Stock Price on Feb. 23, 2018: $29.27Your $2,782 Investment Would Be Worth: $3,377.40

PulteGroup benefited from the same trends that lifted plenty of other homebuilders in 2017 — primarily, a big uptick in home buying in the U.S. At the end of the 2017 third quarter, PulteGroup had a backlog of 10,823 homes with an average selling price of $431,000, the highest average in a decade. The robust housing market has drawn investors in as they project additional growth for builders.

Stock Price on April 17, 2017: $34.16Stock Price on Feb. 23, 2018: $44.47Your $2,782 Investment Would Be Worth: $3,621.65

In case you’re not familiar with the name D.R. Horton, it’s the largest homebuilder in the United States. The nation’s home prices and sales spiked in 2017, so it’s no wonder D.R. Horton’s stock price rose 86 percent for the year. Even if you were late to the game and didn’t invest until you got your tax refund in mid-April, you still would have enjoyed a gain of about 29 percent.

Stock Price on April 17, 2017: $174.42Stock Price on Feb. 23, 2018: $233.84Your $2,782 Investment Would Be Worth: $3,729.75

Illumina is on the cusp of a potentially huge payoff. It’s the market share leader in gene sequencing, which is an important component of next-generation medicine. It’s a new industry that will eventually change the economy. Investors seem impressed by the company’s revenue and profit gains and are extrapolating big things for the future. A tax refund investment in Illumina would have returned you 34 percent.

Stock Price on April 17, 2017: $71.03Stock Price on Feb. 23, 2018: $100.45Your $2,782 Investment Would Be Worth: $3,934.28

Centene, a health insurer with a heavy focus on Medicaid, watched its share price dip in 2016 on fears that Medicaid legislation would crimp earnings. But the company roared back in 2017 as that legislation stalled and Centene used buyouts to move into more states and counties. In addition to running state Medicaid programs, Centene also expanded its presence in Obamacare health exchanges.

Stock Price on April 17, 2017: $18.45Stock Price on Feb. 23, 2018: $26.42Your $2,782 Investment Would Be Worth: $3,983.76

NRG Energy might be a “boring” utility stock, but there’s nothing boring how much money it could have added to your 2017 tax refund. Your $2,782 investment would have popped more than 40 percent. Some investors did even better as NRG’s stock price more than doubled for the full year. The stock reacted very favorably to news that a leadership change at NRG would bring on lower costs and less debt.

Stock Price on April 17, 2017: $114.81Stock Price on Feb. 23, 2018: $165.90Your $2,782 Investment Would Be Worth: $4,019.98

Vertex Pharmaceuticals currently markets two cystic fibrosis drugs, but the company’s pipeline of future drugs is what investors are excited about. If Vertex gets approval for its next-generation CF correctors, that could translate into billions of dollars in new sales for the company. If you had put your tax refund to work in Vertex stock, you would have made a 44 percent profit.

Stock Price on April 17, 2017: $114.64Stock Price on Feb. 23, 2018: $167.13Your $2,782 Investment Would Be Worth: $4,055.79

Wynn Resorts rules the roost in the volatile casino/gaming sector, where much of the action has taken place in China in recent years. After the stock price tanked in 2015-16 amid a Chinese anti-graft crackdown, there was nowhere to go but up when the political climate changed and Wynn’s Macau resorts saw the return of its gamblers. Tax refund investors would have enjoyed about a 46 percent pop from their shares in Wynn.

Stock Price on April 17, 2017: $48.80Stock Price on Feb. 23, 2018: $72.07Your $2,782 Investment Would Be Worth: $4,108.58

Activision Blizzard is what’s known as a “story stock.” Although its recent sales growth has not been spectacular, investors are betting big on the company’s lineup of billion-dollar game franchises. Gamers are spending more time consuming content, and Activision is creating leagues to capitalize on the growth of online gaming. The stock made a big move in 2017 and more could be on the way.

Stock Price on April 17, 2017: $127.33Stock Price on Feb. 23, 2018: $193.10Your $2,782 Investment Would Be Worth: $4,218.99

Semiconductor equipment maker Lam Research is another company riding the tech boom, with its annual revenue nearly doubling over the past three years. Although the company operates in a volatile and cyclical market, recent trends are positive. A well-timed tax refund investment would have netted you a gain of over 50 percent.

Stock Price on April 17, 2017: $129.99Stock Price on Feb. 23, 2018: $209.74Your $2,782 Investment Would Be Worth: $4,488.78

Ever since software maker Adobe Systems shifted its marketing strategy from one-time purchases to a subscription-based model, its sales and earnings have been on a sharp rise. Those sales are considered higher-quality as well because they are recurring and predictable. Investors have rewarded the stock with tremendous gains. Had you bought Adobe shares with your tax refund, you could have netted more than 60 percent.

Stock Price on April 17, 2017: $256.09Stock Price on Feb. 23, 2018: $427.51Your $2,782 Investment Would Be Worth: $4,644.20

Intuitive Surgical is the leader in robotic surgery thanks to its revolutionary da Vinci surgical system. Robotics is a type of technology that could take your job. Robotic procedures continue to grow each year, which is one driver of Intuitive’s top-line growth. The company also makes half of its money selling instruments and accessories. Revenue and operating margins are up — and so is the stock.

Stock Price on April 17, 2017: $86.17Stock Price on Feb. 23, 2018: $146.62Your $2,782 Investment Would Be Worth: $4,733.63

Red Hat’s specific business is probably beyond the understanding of most investors. The company uses Linux tools to link companies’ private and public networks. Red Hat’s earnings and sales both climbed more than 20 percent last year, and it continues to ink larger and larger deals. Investing your tax refund in the stock would have brought a profit above 70 percent.

Stock Price on April 17, 2017: $27.13Stock Price on Feb. 23, 2018: $46.53Your $2,782 Investment Would Be Worth: $4,771.34

In the world of memory and flash storage, Micron is the king. The company recently reported a 71 percent increase in sales and also posted a nearly six-fold increase in earnings. Micron operates in the same highly cyclical industry as Lam Research, but that cycle is up right now. Your tax refund could have grown by about 70 percent between April 2017 and February 2018.

Stock Price on April 17, 2017: $94.14Stock Price on Feb. 23, 2018: $162.41Your $2,782 Investment Would Be Worth: $4,799.50

Heavy equipment maker Caterpillar typically wins big when the global economy expands, so it makes sense that 2017 was a great year for the stock. Caterpillar rode the back of strong U.S. construction markets and continued expansion in China to much better-than-expected earnings gains. If you saw the trend and bought the stock with your $2,782 tax refund, you could have put an additional $2,000 in your pocket.

Stock Price on April 17, 2017: $43.10Stock Price on Feb. 23, 2018: $79.69Your $2,782 Investment Would Be Worth: $5,143.80

PayPal had a blowout 2017 on the back of its new One Touch features, which let users buy products with just one click after attaching their PayPal accounts. Investors are also excited about the potential of PayPal property Venmo, which is a peer-to-peer platform. Investing your $2,782 tax refund in April 2017 would have generated a profit of almost $2,400 by Feb. 23, 2018.

Stock Price on April 17, 2017: $46.92Stock Price on Feb. 23, 2018: $88.50Your $2,782 Investment Would Be Worth: $5,247.38

The company formerly known as Restoration Hardware would have been a good place to put your tax return, as the stock has gone up by about 88 percent since April 2017. RH bounced back hard after a difficult 2016 by moving from a promotional to a membership model and by reducing inventory, among other strategies.

Stock Price on April 17, 2017: $179.02Stock Price on Feb. 23, 2018: $356.66<Your $2,782 Investment Would Be Worth: $5,542.55

Boeing has always been a mature, dividend-paying blue-chip stock. As of the start of 2017, it was rewarding investors with a 3.7 percent dividend yield. The defense and aerospace conglomerate went on to have a blowout earnings year, propelling the stock to new highs. If you had invested your tax return in Boeing, you would have just about doubled your money.

Stock Price on April 17, 2017: $27.34Stock Price on Feb. 23, 2018: $61.79Your $2,782 Investment Would Be Worth: $6,287.48

First Solar’s stock price more than doubled in 2017 because of good news on two fronts. First, word spread that the U.S. might impose tariffs on the import of Chinese-made solar panels, which would be a huge boost for the U.S.-based First Solar. On top of that, the company reported it already has a three-year production backlog of orders. Solar is a fast-growing industry for investors to watch in 2018.

Stock Price on April 17, 2017: $115.18Stock Price on Feb. 23, 2018: $265.07Your $2,782 Investment Would Be Worth: $6,402.37

Align Technology might not be a household name, but it’s become a darling of Wall Street. Align was the best-performing stock in the S&P 500 Index for 2017, with a return for the year of more than 130 percent. The maker of clear aligners is out to replace the metal braces industry, and it’s making great progress. Align’s market share is still just 10 percent, yet annualized revenue has doubled since 2012.

Stock Price on April 17, 2017: $99.23Stock Price on Feb. 23, 2018: $245.93Your $2,782 Investment Would Be Worth: $6,894.86

Nvidia is a maker of next-generation graphics processing chips that are used in a variety of industries. It’s a company that’s changing the world today. Beyond gaming applications, which were the original market for these types of chips, Nvidia taps into any industry that uses artificial intelligence, from data centers and automotive applications to defense. The stock ended up being the biggest gainer on our list of performers from mid-April 2017 through Feb. 23, 2018, posting a whopping 148 percent gain.

Click through to learn how to know when to sell stocks.

This article is produced for informational purposes only and is not a recommendation to buy or sell any securities. Investing comes with risk to loss of principal. Please always conduct your own research and consider your investment decisions carefully.

Some photos are representational and for illustrative purposes only.