The stocks investors loved to hate last year are doing just fine, thank you very much.

The 26 stocks that investors were most expecting to fall have seen an 18% gain this year, Bloomberg reports. That's much higher than the 8.2% rise in the Standard & Poor's 500 Index ($INX).

Bloomberg measured the 26 companies in the S&P 500 that had the highest short interest. These are the shares speculators are borrowing to sell, with hopes of buying them back when the price dropped.

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One of those is Sears Holdings (SHLD), which has been the target of much criticism since it said it would close up to 120 Sears and Kmart stores. Everything about this company is a red flag for investors, and yet Sears shares are up a jaw-dropping 72% this year for reasons that aren't clear to anyone.

Then there's Netflix (NFLX), a stock many dismissed after a series of well-publicized screwups last year. Netflix shares are up 68% this year as investors realize that the company has a clear strategy and is progressing with its international expansion.

Another heavily shorted stock was First Solar (FSLR), which saw 31% of its shares in short interest at one point. Last week, the stock had gained 37% year to date, but Friday that gain had fallen back to 19%.

Another heavily shorted stock, Harris Corp. (HRS), is up 16% this year. The maker of military radios recently beat earnings expectations for the 14th straight quarter, Bloomberg reported.

One of the biggest disasters of last year, Bank of America (BAC), is up 38% so far in 2012. I don't know if this stock was on Bloomberg's list, but it's another example of one defying the haters this year.

Analysts tell Bloomberg that some of these stocks are fundamentally sound companies that got unfairly punished last year. Now, investors are taking a chance on them, and shorts push the stock higher by covering.