These stocks have generated the best returns so far in 2022.
The S&P 500 just completed its worst first half of any year since 1970. Fears over persistently high inflation, aggressive Federal Reserve interest rate hikes and geopolitical conflict between Russia and Ukraine have the S&P 500 down 20% through the end of June. Fortunately for investors, a handful of top-performing stocks have bucked the bearish trend. Top performers include several oil and gas stocks benefiting from surging energy prices, and health care stocks with unique bullish catalysts. Here are the 10 best-performing stocks of 2022 so far among companies that trade on major U.S. exchanges and have market capitalizations of at least $1 billion. Returns are through June 30.
10. CVR Energy Inc. (ticker: CVI)
CVR Energy is a petroleum refiner and nitrogen fertilizer producer. Russia is one of the world’s largest fertilizer producers, and U.S. producers are anticipating huge profits this year as nitrogen, phosphate, urea and ammonia prices soar. In May, CVR reported 57.1% refining revenue growth and 265.6% nitrogen fertilizer revenue growth in the first quarter and said it redeemed all $65 million of its 9.25% senior secured notes due in June 2023. Given fertilizer prices remain elevated heading into the summer months, investors are likely expecting even bigger second-quarter numbers. CVI shares are up 99.3% year to date.
9. Occidental Petroleum Corp. (OXY)
Occidental Petroleum is a U.S. oil and gas company and the only large-cap stock among the top 10 market performers of 2022. In addition to benefiting from rising oil prices, Occidental has gotten a major vote of confidence from one of the biggest investors on Wall Street. Warren Buffett‘s Berkshire Hathaway Inc. (BRK.A, BRK.B) has purchased 153.5 million shares of Occidental in 2022, a position worth about $9 billion. Not only does Buffett own a roughly 16% stake in Occidental, Berkshire also holds warrants to purchase nearly 84 million more shares. If exercised, that would make its stake more than 25%. OXY stock is up 103.1% year to date.
8. Alpha Metallurgical Resources Inc. (AMR)
Alpha Metallurgical Resources is a Tennessee-based coal miner. While clean energy may be the biggest long-term growth trend in the energy sector, coal prices have surged along with oil and gas prices so far in 2022 as the world pushes to combat energy shortages by any means necessary. In fact, in the past year, coal prices are up 180%, significantly more than both the 42% gain in crude oil prices and the 58% gain in natural gas prices. In March, Alpha reported first-quarter revenue growth of 177.5% and net income growth of 1,317.4%. That impressive growth has driven AMR stock up 111.5% year to date.
7. Peabody Energy Corp. (BTU)
Peabody Energy is one of the world’s largest pure-play coal producers. Even before the Ukraine conflict sent coal prices skyrocketing, Peabody reported 58% revenue growth from coal sales in the first quarter of 2022. In addition, Peabody paid back $42 million in debt and completed a $320 million convertible notes offering to retire higher-cost debt. Given the recent trends in coal prices and the absence of any meaningful progress toward a resolution in Ukraine, Peabody investors are understandably expecting the company’s big growth numbers to continue throughout 2022. BTU stock is up 111.8% year to date.
6. Consol Energy Inc. (CEIX)
Consol Energy produces coal in the U.S. Appalachian Basin. Like other coal stocks, Consol has benefited from soaring energy prices, especially since Russia invaded Ukraine. In May, Consol reported 4.7% revenue growth in the first quarter. Consol also generated $118 million in free cash flow, boosted its unrestricted cash holdings by more than $70 million and repaid nearly $39 million in debt. Consol reported a record $21.4 million marine terminal revenue in the quarter and said its Itmann preparation plant is on track to begin operations in the second half of 2022. Consol shares are up 117.4% year to date.
5. PBF Energy Inc. (PBF)
PBF Energy is an independent refiner that produces gasoline, diesel and other refined products. PBF has taken advantage of the favorable energy environment to significantly improve its balance sheet in recent quarters, repaying $390 million in debt in just 15 months. Diesel prices are up 58% in 2022, while gasoline prices have increased by 47%. In April, PBF reported 85.6% revenue growth in the first quarter. Investors can expect PBF to continue to improve its balance sheet and even potentially restore its dividend, which it suspended in March 2020. PBF Energy shares are up 123.8% year to date.
4. Lantheus Holdings Inc. (LNTH)
Lantheus is a diagnostic imaging technology company. Lantheus shares ripped higher by 39% in February the day the company reported blowout fourth-quarter earnings and revenue numbers, and roughly 16% higher in April when it raised its 2022 earnings and revenue guidance. Lantheus’ launch of its Pylarify PET imaging agent for prostate cancer has been a tremendous success, and the company said Pylarify was the primary driver of its 125.8% revenue growth in the first quarter over the prior-year period. Lantheus is also generating impressive sales growth from its Definity diagnostic ultrasound enhancing agent. The company’s bullish sales momentum has propelled LNTH stock higher by 128.6% year to date.
3. Sierra Oncology Inc. (SRRA)
Sierra Oncology is a late-stage biopharmaceutical company developing momelotinib to treat myelofibrosis patients with anemia. Sierra shares jumped about 38% in early April when GSK PLC (GSK), formerly known as GlaxoSmithKline, announced a $1.9 billion buyout of Sierra priced at $55 per share. GlaxoSmithKline is already a leader in hematology, and it expects momelotinib sales will begin in 2023 and potentially grow significantly from there. Sierra shares are trading at $54.99 as of June 30, leaving virtually no additional upside for investors. However, the buyout announcement was enough to push Sierra’s year-to-date stock gains to 152.9%, making it a top 2022 performer.
2. NexTier Oilfield Solutions Inc. (NEX)
Like other energy stocks, energy services company NexTier Oilfield Solutions has benefited from rising oil and gas prices in 2022. In early January, the stock surged more than 20% after it updated its fourth-quarter financial guidance, and the stock’s bullish momentum has continued ever since. In April, NexTier reported $635 million in first-quarter revenue, its fourth consecutive quarter of at least 25% growth. CEO Robert Drummond said frac capacity is nearly fully utilized at this point, positioning NexTier for free cash flow generation and profitable growth in the foreseeable future. NEX stock is up 167.9% year to date.
1. Scorpio Tankers Inc. (STNG)
Scorpio Tankers operates a fleet of ocean tankers that transports refined petroleum products worldwide. Tanker rates surged when Russia invaded Ukraine, and Scorpio has taken advantage of a favorable environment by moving to reduce its debt by $513 million in the first half of 2022. The company estimates elevated tanker rates potentially helped the company generate $450 million in pro forma liquidity through the end of the second quarter. Revenue was up 29.7% in the first quarter over the prior-year period. Booming refined product demand, supply chain disruptions and historically low inventories will continue to support tanker rates. Scorpio shares are up 169.4% year to date.
10 best-performing stocks in 2022:
1. Scorpio Tankers Inc. (STNG)
2. NexTier Oilfield Solutions Inc. (NEX)
3. Sierra Oncology Inc. (SRRA)
4. Lantheus Holdings Inc. (LNTH)
5. PBF Energy Inc. (PBF)
6. Consol Energy Inc. (CEIX)
7. Peabody Energy Corp. (BTU)
8. Alpha Metallurgical Resources Inc. (AMR)
9. Occidental Petroleum Corp. (OXY)
10. CVR Energy Inc. (CVI)
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2022’s 10 Best-Performing Stocks originally appeared on usnews.com
Update 07/01/22: This story was published at an earlier date and has been updated with new information.
