7 of the best performing stocks in the third quarter

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Major stocks from the last quarter could dominate the market for the remainder of 2021. Many investors like to browse…

Major stocks from the last quarter could dominate the market for the remainder of 2021.

Many investors like to browse the list of stocks with new 52 week lows for investment ideas. There is a natural instinct against the grain to seek value in companies that are falling sharply. However, many astute traders prefer to buy stocks reaching new highs. On the one hand, a high quality business tends to register many more new highs than new lows in its lifetime. Momentum is important; As Newton’s First Law says, a moving object will stay in motion until something disturbs it. A stock that is picking up tends to keep climbing for longer than people might expect. As such, it’s worth looking at which stocks are currently working to see what could lead the way at the end of 2021. These are seven of the top performing stocks in the S&P 500 over the three-year period. month ending October 15.

Devon Energy Corp. (ticker: DVN)

Devon was the only component of the S&P 500 to rise more than 60% in the past three months, on the heels of an absolutely stunning second quarter earnings report. Devon saw revenue growth of over 500% year over year, taking profits from negative territory to a big gain. Since the first quarter, Devon has also increased its free cash flow six-fold. Ailing energy companies have found a new lease of life thanks to the recent surge in oil and natural gas prices. Devon was in grave danger a year ago and could end up on the ropes again if the current inflationary wave wears off. For now, however, the company is flying high and could have even more to do if oil continues its push towards $ 100 a barrel. That would mark the highest price of oil since 2014, and likely spark another big wave of speculation in energy names like Devon.

APA Corp. (APA)

While Devon Energy has won the performance race in recent months, its energy counterpart APA was not far behind. It has gained 53% since mid-July and has almost tripled in the past year. Like Devon, it experienced a commercial renaissance; it more than doubled its turnover in the second quarter of 2021 compared to the same quarter last year. APA has excited its investors with promising developments coming from the South American nation of Suriname. The country, which is close to oil-rich Venezuela, may also hold an abundant supply of oil offshore. The APA had been falling steadily for years until energy prices started to rebound. Its investments in the United States in areas such as Alpine High have not yielded the expected results. However, the combination of a brighter outlook in Suriname and significantly higher oil prices may be enough to keep the APA stock recovering.

Paycom Software Inc. (PAYC)

Paycom Software was S&P’s top performer outside of the resource sector; stocks have jumped 40% in the last quarter. Paycom is a leader in what is called “human capital management”. In English, this means that Paycom’s software allows employees to be tracked from recruitment to retirement. It allows employers to easily manage things like job applications, benefits and perks, scheduling, electronic verification and other such tasks. The company is steadily increasing its revenues by around 25% per year and its profits at an even faster rate. With the latest surge in the Paycom share price, it is now trading at over 100 times earnings and 25 times sales. However, investors are willing to look past the valuation for now as a roaring economy has helped to bolster the need for Paycom’s services.

The Mosaic Co. (MOS)

Energy isn’t the only commodity on a tear. The wave of inflation spread to fertilizers. This is great news for investors in Mosaic, which has risen 36% in the past three months, making it one of the best performing stocks on the S&P over the same period. Mosaic is a leading producer of nutrients for phosphate, potash and nitrogen crops as well as animal feed, among other products. Analysts see the company’s revenue increase 42% in 2021 from a year ago, reaching $ 12.3 billion. Thanks to the magic of higher profit margins, this 42% jump in revenue is expected to quintuple profits from 2020. It is currently unclear how long the fertilizer compression will last; Analysts are forecasting slightly lower profits in 2022 and 2023 for Mosaic compared to this year. Still, the stock is trading around nine times the earnings this year and next. Regardless of the size of the inflation wave, farmers will continue to purchase Mosaic products. This makes MOS one of the more intriguing options for taking advantage of current supply chain issues.

Advanced Micro Devices Inc. (AMD)

AMD was another of the biggest tech stocks in the third quarter. The global semiconductor shortage has been great news for many in the industry. That would be pretty fortuitous for AMD, but it is also starting to ride the wave of cryptocurrency mining demand. As if that weren’t enough, AMD continues to profit from the stumbles of its main rival Intel Corp. (INTC). All in all, it’s been a fantastic year for AMD and Nvidia Corp. (NVDA) regarding the request. Skeptics may say that the valuation of AMD stock looks strained. After all, it sells for 45 times the estimated profits of 2021, and a big tailwind, cryptocurrency mining, could diminish as Ethereum moves from a proof-of-work mining algorithm to a proof of stake extraction algorithm. However, right now bulls on the uptrend are making money with AMD, which is one of the top performing stocks on the famous S&P 500, up 30% in the past three months.

Albemarle Corp. (ALB)

Turning to another staple, lithium producer Albemarle jumped 28% in the last quarter. Albemarle is a specialty chemicals company with three main operating divisions: catalysts, bromine specialties and lithium. It is the latter that attracts the most attention. The price of lithium hit new two-year highs in August, driven by strong sales of electric vehicles and strong demand from Chinese battery producers. Meanwhile, supply has been limited in part due to issues with the global shipping market. This makes major lithium producers, such as Albemarle, an attractive way to gain exposure to the electric vehicle market without taking the real risks inherent in making and selling cars. Albemarle’s income fell by about half in 2020 due to the pandemic, but is back on the rise now. Over the next two years, analysts see the company’s profits double from current levels. Clearly, traders are taking steps to take advantage of this next peak in profitability.

Tesla Inc. (TSLA)

Finally, it would be difficult to complete a list of Q3 performers without mentioning Tesla. Despite more controversies involving Tesla and Elon Musk, stocks are back on the rise. Tesla shares have jumped more than 25% in the past three months. Tesla’s uneven rollout of its long-awaited autonomous driving software has disappointed some loyal vehicle owners. It also faces increasing competition as Lucid Group Inc. (LCID) prepares to bring its own premium electric vehicles to market. Either way, Tesla shrugged off those concerns as stocks climbed back above the $ 800 mark. Perhaps investors are factoring in the tax savings resulting from the company’s recently announced move from California to Texas. Either way, Tesla’s stock continued to drive bears insane for another quarter.

Seven of the best performing stocks in the third quarter:

– Devon Energy Corp. (DVN)

– APA Corp. (APA)

– Paycom Software Inc. (PAYC)

– The Mosaic Co. (MOS)

– Advanced Micro Devices Inc. (AMD)

– Albemarle Corp. (ALB)

– Tesla Inc. (TSLA)

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7 of the best performing stocks in the third quarter originally appeared on usnews.com


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