Asset management – Page 2

Are we bored yet? Retail investors slowing their roll on AI stocks, according to this chart

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There are more signs that investors are cooling a bit on the hot artificial intelligence play, though no one appears ready to let go of their Nvidia stock just yet.

That’s according to Vanda Research analysts, who shared a chart of their latest weekly data showing how retail investor’s net purchases of AI-themed stocks is “steadily waning”:

Marco Iachini, senior vice president, Giacomo Pierantoni, head of data and Lucas Mantle, data scientist at Vanda, said they’ve also noticed fewer news stories covering the sector as well, in their Vandatrack weekly comment that published Thursday.

The fervor for AI-related stocks and technology took off earlier this year, with a pinnacle moment in May when Nvidia
NVDA,
-2.89%
made big predictions on a boom for demand for its AI-related chips. Shares of the company are still up 211% so far this year, but enthusiasm for many tech stocks faded in August as China and interest rate-hike worries cropped up and some companies stressed AI benefits might not happen right away.

That said, Vanda analysts don’t expect Nvidia will feel the hurt of any such waning interest. They point out that short interest in the chip maker has seen a “considerable decline,” in line with its soaring stock price.

“This phenomenon suggests that bearish institutional investors, including long/short hedge funds, may have been compelled to cover their short positions,” said Iachini and his team. “As a result they are unlikely to want to sell the stock in the near term barring strong conviction to do so.”

“It is crucial to recognize that a slowdown in retail demand, by itself, is improbable to trigger substantial price movements, without active bearish participation from institutional investors,” they added.

However, the story is different for smaller AI-related companies such as smaller-cap C3.ai
AI,
-2.78%
as seen in their chart:

For C3.ai, they see a selling trend persisting in coming weeks. The AI software group’s shares are up 154% so far this year, but down 9% this month, taking a hit recently from solid quarterly results that came with forecasts for a bigger-than-expected full year loss. Analysts aren’t quite giving up — among 10 covering the company tracked by FactSet most have hold or a similar rating.

“We believe C3.ai is taking the proper steps to capitalize on Generative AI, but it will take time to prove out,” said a team of analysts at Oppenheimer led by Timothy Horan, after those results were released on Sept. 7. They rate the company perform.

Vanda analysts said another exception to an AI buying slowdown has been IonQ
IONQ,
-6.21%,
“a relatively small quantum computing company that has been outperforming its AI-related counterparts.” They noted “remarkably resilient” demand for the stock, as short interest also increases rapidly.

“This juxtaposition raises a cautionary flag, as a potential weakening of retail interest, coupled with speculative institutional investors accumulating short positions, could create a demand-supply imbalance, potentially triggering a selloff,” they said. Shares of IONQ have soared 422% year-to-date. The company lifted its lifted full-year bookings guidance last month as it reported blowout second-quarter sales.

Young Money blogger Jack Raines highlighted the slowing interest in AI in a post on Thursday , citing data from analytics firm Similarweb that showed ChatGPT traffic down 3.2% in August, after 10% declines in June and July.

“While ChatGPT will probably experience a resurgence this fall as students return to the classroom and expedite their homework via chatbot, it seems like talks of AI disrupting/replacing anything and everything have cooled down,” he said, adding that the “initial euphoria was a bit much.”

Deutsche Bank strategists hopped on the topic in a note to clients entitled “Even hype needs a summer break,” on Thursday, noting how AI interest waned as investors went to the beach and the media turned its attention to extreme weather and “silly season” stories.

“Under the surface, though, there have been important developments indicating a slow maturing of the cycle, of the underlying technologies and of attitudes to a revolution in waiting,” said a team led by analyst Adrian Cox.

Those include Ai being the “elephant in the earnings room,” this summer that also brought a steady stream of AI-related tech announcements. Another theme “Your job is safe..for now,” came via fresh evidence that AI might boost rather than replace white-collar jobs, while yet another saw U.S. politicians also got involved.

This week saw Tesla CEO Elon Musk telling Capital Hill politicians that a new federal agency to oversee AI development is a must.

Another big theme that erupted this summer was the chatter by contrarian commentators questioning the hype around generative AI. Cox alluded to the Similarweb report that got everyone excited as it showed Chat GPT traffic falling to 1.4 billion visitors in August from 1.8 billion in May.

“The bigger picture is that open.ai had zero visitors before the launch of ChatGPT less than a year ago and is now No. 28 in the world, according to Similarweb,” said the Deutsche Bank team.

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September 15, 2023

Watch this ‘canary in the coal mine’ for signs of trouble in markets, Neuberger Berman CIO says

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Neuberger Berman, an asset manager with eight decades under its belt, is on the lookout for cracks in credit markets from the Federal Reserve’s rate-hiking campaign.

Erik Knutzen, chief investment officer of multi asset, worries that several factors could be a tipping point for the economy, from an economic slowdown in China to U.S. consumers finally becoming exhausted by higher rates.

Yet Knutzen expects the high-yield, or junk bond, market to serve as the “canary in the coal mine” for broader market volatility, acting as “perhaps the most visible threat, and therefore one we think could be priced in sooner than later.”

The Bloomberg U.S. High Yield Bond Index has returned 6.4% through the end of August, producing one of the year’s highest gains in fixed income, helped along by a “resilient U.S. economy coupled with still-available financial liquidity,” according to the Wells Fargo Investment Institute.

But Knutzen worries that as the high-yield maturity wall draws closer, “the first policy rate cuts get priced further and further out, raising the threat of expensive refinancings.”

The 10-year Treasury yield’s
BX: TMUBMUSD10Y
climb to a multidecade high in August of almost 4.4% left many major U.S. corporations in early September hesitant to borrow beyond 10 years.

Starting next year, some $700 billion of high-yield bonds are set to mature through the end of 2027, with a big slice of the refinancing need coming from companies with riskier credit ratings below the top BB ratings bracket.

The junk-bond maturity wall.

Bloomberg, Wells Fargo Investment Institute, Moody’s Investors Service

The two big U.S. exchange-traded funds linked to junk bonds are the SPDR Bloomberg High Yield Bond ETF
JNK
and the iShares iBoxx $ High Yield Corporate Bond ETF
HYG,
both up 1.8% and 1.5% on the year through Monday, respectively, while offering dividend yields of more than 5.8%, according to FactSet.

Of note, fixed-income strategists at the Wells Fargo Investment Institute also said they see risks emerging in junk bonds for companies rated B and below, particularly with spread in the sector trading less than 400 basis points above the risk-free Treasury rate since July. Spreads are the premium that investors are paid on bonds to help compensate for default risks.

Top corporate executives appear hopeful that the Federal Reserve will cut rates sooner than later. Fed Chairman Jerome Powell said in Jackson Hole, Wyo., in August that the central bank is prepared to keep its policy rate restrictive for a while to get inflation down to its 2% target.

To that end, Neuberger Berman, which has roughly $443 billion in managed assets, sees several sources of volatility lurking through year’s end, and has a “defensive inclination” in equity and credit, favoring high-quality companies with plenty of free cash flow, high cash balances and less expensive long-term debt.

U.S. stocks booked gains on Monday after a week of losses, with the S&P 500 index
SPX
and Nasdaq Composite Index
COMP
scoring their best daily percentage gains in about two weeks. The Dow Jones Industrial Average
DJIA
advanced 0.3%.

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September 11, 2023

C3.ai, GameStop, UiPath, ChargePoint, Yext, BlackBerry, and More Stock Market Movers

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This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com.

https://www.barrons.com/articles/stock-market-movers-3fac9192

Updated Sept. 7, 2023 6:33 am ET / Original Sept. 7, 2023 4:37 am ET

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September 7, 2023

Wall Street is raising quarterly profit forecasts for the first time in two years, and executives are relaxing about recession prospects

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After nearly two years of concerns about a recession, growing optimism about the economy is starting to filter down into Wall Street’s expectations for individual companies’ quarterly results, with analysts growing more upbeat about corporate profit in the months ahead

While expectations for those quarterly results usually trend lower as earnings season arrives, analysts over the past two months have actually nudged their profit forecasts higher for the first time in two years, according to a FactSet report released Friday….

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September 3, 2023

How Wall Street’s REIT giants are reshaping U.S. real estate

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U.S real estate investment trusts today manage $4.5 trillion in real estate worldwide. Many groups on Wall Street offer these tax-friendly funds to retail investors.

KKR’s real estate business is one of the big players in the REIT game. The private equity firm manages multiple REIT funds. The KKR Real Estate Select Trust, which currently manages $1.5 billion in assets, paid a dividend of 5.4% to its investors in July 2023.

But the benefits extend beyond returns.

“When you look at the after tax equivalent of that yield, it is very compelling.” said Billy Butcher, CEO of KKR’s global real estate business. “The depreciation from our properties has covered 100% of the income generated by our properties, and there’s no tax on that dividend,” he said in an interview with CNBC.

Larger funds sometimes contain a diversified pool of assets. Categories may include office, student housing, casino, timberlands, radio and cell towers, server farms, self-storage properties, billboards, and much more.

“Back in the 1960s, there were three or four different types [of REITs], said Sher Hafeez, a managing director at Jones Lang LaSalle, a real estate services firm. “Now, I can count at least 20 different types.”

Top performing REIT sub-sectors in recent years include data centers, self-storage properties, residential housing and tower REITs. Residential housing delivered a return of 16% from 2010 to 2020, according to a S&P Global Investments report.

The investor-friendly tax rules can also increase the pace of large-scale development.

“Having REITs there as a potential exit helps the market, and helps the availability of financing,” said Michael Pestronk, CEO and co-founder of Post Brothers, a Philadelphia-based housing developer.

Some funds like Invitation Homes and American Homes 4 Rent were founded in the yearslong slowdown in U.S. home construction. At the time, REITs bought and managed commercial-scale properties, which could include products like master-planned communities or traditional apartment complexes.

In recent years, publicly traded trusts have targeted single-family rental market, and today, these REITs have grown tremendously — enough to build new neighborhoods in their entirety.

Watch the video above to learn the fundamentals of real estate investment trusts.

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September 1, 2023

The nation’s biggest banks are gearing up for more consumer struggles ahead

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JPMorgan Chase & Co. Chief Executive Jamie Dimon on Friday said the U.S. economy was basically doing OK, even if customers were spending “a little more slowly.”

But with rivals like Bank of America Corp., Goldman Sachs Group Inc. and American Express Co. set to report quarterly results this week, recession agita still prevails.

For evidence, look no further than JPMorgan’s
JPM,
+0.60%
own quarterly results. The bank’s second-quarter profit blew past expectations, but it set aside $2.9 billion during the second quarter to cover potentially bad loans, amid concerns that more consumers could run into more difficulty paying their bills on time as higher prices manage to stick at stores.

That figure was well up from $1.1 billion in the same quarter last year, although still far below the billions it stowed away when the pandemic first hit. Similarly, Wells Fargo & Co.
WFC,
-0.34%
on Friday set aside $1.7 billion for loan losses in this year’s second quarter, nearly triple what it was a year ago.

The figures underscore the anxiety over the second half of this year, when many economists expect the economy to tilt into a recession. However, for the 500 companies in the S&P 500 index, Wall Street analysts still expect profit growth.

Any downturn could be exacerbated by the pressure investors have put on companies, potentially via more layoffs and money-saving technology, to keep prices high and cut costs to replicate the abnormally large profit-margin gains they put up in 2021 and 2022. Businesses have indeed kept prices high, at least for many basic necessities, in an effort to cover their own higher costs and to pad profits.

When Bank of America
BAC,
-1.89%
reports this week, the results will narrow the lens on lending and spending in the U.S. Results from Morgan Stanley
MS,
-0.50%
and Goldman Sachs
GS,
-0.76%
will fill in the gaps on trading and deal-making. American Express
AXP,
-0.49%
will give a more detailed breakdown of what consumers are still spending their money on, after Delta Air Lines Inc.
DAL,
-2.35%
— which has a partnership with AmEx — said that travel demand remained “robust.”

Banks shoveled more money into their reserve stockpiles in 2020 to bulk up against the pandemic’s shutdown of the economy. A year later, they started releasing those funds as the economy reopened and recovered. FactSet expects the broader banking sector to plump up its cash cushion during this year’s second quarter to account for more late loan payments or potential defaults.

In a report on Friday, FactSet said the 15 banking-industry companies in the S&P 500 Index tracked by the firm were on pace to set aside $9.9 billion to cover losses from souring loans in the second quarter. That’s more than double the amount set aside a year ago. And if that $9.9 billion figure, based on actual and projected financial figures, ends up as the actual figure at the end of the quarter, it would mark the highest since the beginning of the pandemic and the third highest in five years, according to FactSet data.

“The U.S. economy continues to be resilient,” Dimon said in a statement on Friday. “Consumer balance sheets remain healthy, and consumers are spending, albeit a little more slowly. Labor markets have softened somewhat, but job growth remains strong.”

However, he noted difficulties in JPMorgan’s investment banking segment. And he said consumer savings were slowly eroding as inflation endures.

As the nation’s biggest bank, JPMorgan has flexed its financial muscle this year, swallowing up First Republic after that bank got into trouble. But as it consolidates power and influence, building thicker armor against shocks to the economy, its financial results might not always reflect the struggles of its smaller rivals, where difficulties are likely felt more acutely. Analysts at Raymond James said that while JPMorgan remained a “best in breed” bank, its outlook pointed to “heightened challenges for smaller banks.”

This week in earnings

For the week ahead, 60 S&P 500 companies, including five from the Dow, will report quarterly results, according to FactSet. Two big oil companies, Halliburton Co.
HAL,
-2.28%
and Baker Hughes Co.,
BKR,
-0.95%
will report, as oil prices fall from levels seen last year. Results from two transportation giants — trucking company J.B. Hunt Transport Services
JBHT,
-0.42%
and railroad operator CSX Corp.
CSX,
-0.27%
— will also be a proxy for how much people are buying things and having them shipped. United Airlines Holdings Inc.
UAL,
-3.42%
and American Airlines Group
AAL,
-1.68%
will also report.

The call to put on your calendar

Netflix results: Hollywood shutdown, ‘slow-growth’ expectations. Hollywood’s writers — and now its actors — have gone on strike, and Netflix Inc.
NFLX,
-1.88%
reports second-quarter results on Wednesday. The streaming platform will likely face questions over how much content it has left in the tank, as the strike upends studio-production schedules and leaves viewers with vast expanses of reruns. Still, Macquarie analyst Tim Nollen said that the production standstill “may ironically drive even more viewers to streaming services.”

The writers and actors argue that the studio industry — increasingly consolidated, increasingly publicly traded, increasingly oriented around a handful of film franchises — has profited immensely while skimping on things benefits and streaming residuals. But after a decade-long rise, and a recent shift in investor focus from subscriber growth to profit growth, Netflix has emerged as one of the biggest production powerhouses in the business. And after years of flooding customers with new films and shows, it’s trying to squeeze out sales via more boring ways: things like a password-sharing crackdown and ads.

Daniel Morgan, senior portfolio at Synovus Trust Co., said Netflix still faced a plenty of streaming competition amid “muted” subscriber growth. But Wedbush analyst Michael Pachter said investors should look at Netflix as a profitable, albeit more mature company.

“We think Netflix is well-positioned in this murky environment as streamers are shifting strategy, and should be valued as an immensely profitable, slow-growth company,” Pachter said in a research note on Friday.

“Even while the ad-supported tier is not yet directly accretive (we think it will be accretive over time), the ad-tier should continue to reduce churn and draw new subscribers to the service,” he continued.

The number to watch

Tesla sales. Electric-vehicle maker Tesla Inc. also reports second-quarter results on Wednesday. And like streaming, some analysts say the fervor for EVs has faded.

However, they also said that Tesla
TSLA,
+1.25%
had so far been immune from the malaise. And even though Elon Musk remains preoccupied with Twitter — which now faces competition from Meta Platforms Inc.’s
META,
-1.45%
Threads — Tesla’s second-quarter deliveries were far above expectations. Sales are expected to be big. And one analyst said that price cuts, which Tesla has used to capture more of the auto market in China, were likely “fairly minimal” during the second quarter. But some analysts wondered what the blowout delivery figures would mean for margins. And the industry, broadly, has increasingly tested the patience of profit-minded investors.

“We’ve now seen a market where demand is constrained, capital has been tighter, and there is less tolerance for EV related losses,” Barclays analysts said in a note last week, adding that there was a “step back from EV euphoria.”

Claudia Assis contributed reporting.

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July 16, 2023

InfraMarker Brings RFID Power to Esri Field Operation Applications

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InfraMarker RFID App is now fully integrated with Esri’s ArcGIS Survey123 and ArcGIS Field Maps mobile applications

MADISON, Wis., July 6, 2023 (Newswire.com)
–
Berntsen International, Inc, a leading manufacturer of infrastructure marking products, announces that its InfraMarker RFID app is now fully integrated with Esri’s ArcGIS Survey123 and ArcGIS Field Maps mobile applications.

Berntsen’s InfraMarker app connects passive UHF RFID – the fastest-growing asset identification technology in the world, with Esri’s ArcGIS, the global market leader in geographic information system (GIS) software. The InfraMarker app enhances Esri’s field data collection tools with the ability to read RFID tag information, write data to an RFID tag, associate the RFID serial number with the asset record in the GIS database, and launch inspection and management forms with an RFID interrogation.

“We are proud to bring RFID – the serial number of IoT – to Esri customers across the globe. We are confident that infrastructure managers in utilities, public works, and construction will realize speed, reliability, and cost benefits with InfraMarker RFID,” said Mike Klonsinski, president of Berntsen.

InfraMarker, a division of Berntsen International, is the leader in connected RFID-enabled infrastructure asset marking products and software. The InfraMarker line includes rugged RFID-enabled marking products, RFID readers and accessories, and RFID-connecting software to enhance GIS and asset management platforms.

About Berntsen International, Inc.

Since 1972, Berntsen International has provided high-quality marking products to define the boundaries and infrastructure of the world. Berntsen marking products have been deployed throughout the world and its survey caps and monuments are recognized as the global standard.

Berntsen’s commitment to better infrastructure marking is taken to the next level with its innovative InfraMarker line of software, products, and solutions. The InfraMarker approach enables a connected infrastructure world by linking GIS platforms with RFID asset marking technology. Connected RFID infrastructure improves safety and field operations management for utilities, municipalities, and other organizations desiring better field asset management.

Berntsen is a Silver Partner in the Esri Partner Network, and InfraMarker RFID is an approved ArcGIS System Ready Specialty accessible on Esri’s ArcGIS Marketplace. Visit Inframarker.com for more information and to purchase an introductory InfraMarker RFID package.

Source: Berntsen International, Inc.

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July 6, 2023

BlackRock is applying for a spot bitcoin ETF. Here’s why it matters to the crypto industry.

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BlackRock, the world’s largest asset manager, has filed an application for a spot bitcoin exchange-traded fund.

There are currently no such products in the U.S. The SEC approved several bitcoin BTCUSD futures-based ETFs in the past, but has yet to greenlight anything that is backed by bitcoin itself.

BlackRock BLK will tap Coinbase Global…

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June 15, 2023

Nvidia surge boosts Nasdaq futures while debt-ceiling debacle damps Dow

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U.S. stock futures were mixed Thursday as Nvidia results boosted tech but debt ceiling concerns weighed on the Dow.

How are stock-index futures trading

S&P 500 futures
ES00,
+0.67%
rose 21 points, or 0.5%, to 4147
Dow Jones Industrial Average futures
YM00,
-0.14%
fell 107 points, or 0.3%, to 32747
Nasdaq 100 futures
NQ00,
+1.83%
jumped 225 points, or 1.6%, to 13875

On Wednesday, the Dow Jones Industrial Average
DJIA,
-0.77%
fell 256 points, or 0.77%, to 32800, the S&P 500
SPX,
-0.73%
declined 30 points, or 0.73%, to 4115, and the Nasdaq Composite
COMP,
-0.61%
dropped 76 points, or 0.61%, to 12484.

What’s driving markets

Recurring fiscal concerns are battling with a nascent technological paradigm for the market’s lead. Fears about the looming debt-ceiling deadline is counteracted by ebullience over AI to deliver a stark bifurcation.

Futures for the Dow Jones Industrial Average — a gauge arguably currently more sensitive to broader economic conditions — were under pressure early Thursday, while futures for the tech-rich Nasdaq 100 — powered by optimism over a secular AI shift — surged strongly.

“The prospect of the U.S. government being unable to meet its financial obligations continues to be a key influence on investor sentiment in global equity markets,” said Derren Nathan, head of equity research at Hargreaves Lansdown.

Ructions at the short end of the Treasury market — where some 1-month bill yields
TMUBMUSD01Y,
5.174%
broke above 7% — illustrate trader anxiety that unless Congress can reach an agreement to extend the debt-ceiling the U.S. government may technically default at the beginning of June.

Ratings agency Fitch late Wednesday said it was placing Washington’s AAA credit rating on watch for a possible downgrade given what it termed the debt ceiling “brinkmanship”.

However, results and comments from chipmaker Nvidia
NVDA,
-0.49%,
whose stock is soaring 25% in premarket action, have boosted hopes that AI will deliver the next period of strong growth for a number of tech companies.

“The AI revolution may be making a lot of noise but results from microchip firm Nvidia hint at some substance behind the hype,” said Russ Mould, investment director at AJ Bell.

CS.ai Inc.
AI,
+2.54%
and Advanced Micro Devices
AMD,
+0.14%
were among those bathing in Nvidia’s AI glow early Thursday.

The optimism over semiconductors bade well for the wider tech sector, according to Mark Newton, head of technical strategy at Fundstrat: “Semis in relative terms to broader technology, have the potential to break back out to new all-time highs this week on a ratio basis. That would be important and positive for this leading sector to show such strength.”

U.S. economic updates set for release on Thursday include the weekly initial jobless claims data and the second reading of first quarter GDP, both at 8:30 a.m. Eastern. Pending home sales for April will be published at 10 a.m..

Fed officials making comments include Richmond Fed President Tom Barkin speaking at 9:50 a.m. and Boston Fed President Susan Collins talking at 10:30 a.m.

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May 25, 2023

Nvidia barrels toward rare $1 trillion valuation after putting a dollar figure on AI boost

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Nvidia Corp. headed toward market-capitalization gains of nearly $200 billion in after-hours trading Wednesday, which could put the chip maker within sight of becoming only the seventh U.S. company to top a valuation of $1 trillion.

Nvidia shares
NVDA,
-0.49%
jumped 25% in the extended session Wednesday, after executives predicted that revenue would exceed the company’s record by more than 30% in the current quarter. The audacious forecast arrived as tech companies look to jump on advances in artificial intelligence that are largely powered by Nvidia’s computing gear.

Nvidia ended Wednesday’s session with a market cap — the total value of all shares in existence — of roughly $754.3 billion, according to FactSet. A 25% increase would add nearly $189 billion to that total, putting the company within striking distance of $1 trillion. Only six U.S. companies have ever attained a $1 trillion market cap: Apple Inc.
AAPL,
+0.16%
and Microsoft Corp.
MSFT,
-0.45%
are currently worth more than $2 trillion apiece; Google parent Alphabet Inc.
GOOGL,
-1.35%
and Amazon.com Inc.
AMZN,
+1.53%
have valuation of more than $1 trillion; and Facebook parent Meta Platforms Inc.
META,
+1.00%
and Tesla Inc.
TSLA,
-1.54%
have both touched the $1 trillion plateau previously.

For more: From U.S. Steel’s $1 billion market cap to Apple’s $1 trillion — a brief history of valuation milestones

Nvidia’s market cap was ahead of both Meta and Tesla as of Wednesday’s close, with both worth less than $650 billion, showing the potential fleeting nature of such a valuation. Nvidia’s record market cap is $834.4 billion, established on Nov. 29. 2021, according to Dow Jones Market Data.

If Nvidia’s gains hold through Thursday’s trading session, the company could challenge for the largest one-day market-cap gain in history. The biggest currently on record was Amazon’s $191.2 billion increase on Feb. 4, 2022, according to Dow Jones Market Data, followed closely by a $190.9 billion gain by Apple on Nov. 10, 2022. Nvidia also stands to gain more than rival Advanced Micro Devices Inc.
AMD,
+0.14%
is worth in total — AMD ended Wednesday’s session with a market cap of $174.4 billion.

Nvidia is closing in on the rare $1 trillion plateau because of huge gains in its stock this year, as hopes and hype about generative AI have flooded the tech sector. After OpenAI debuted its ChatGPT AI offering, and investor Microsoft quickly integrated the chatbot into many of its services, expectations for the technology have exploded.

Despite the hype, most companies have avoided providing hard figures for revenue gains expected from AI. Nvidia’s fiscal second-quarter forecast — which calls for roughly $11 billion in sales, nearly 33% higher than Nvidia’s previous quarterly record of $8.28 billion — could be seen as the first sign of a wave of fresh spending coursing through the tech sector.

Other companies have indicated that they will be forced to spend to develop their technology before reaping large financial rewards from it. Microsoft, for example, disclosed to investors last month that capital expenditures are increasing as it builds AI capabilities into its Azure cloud-computing platform — spending that is largely going toward Nvidia.

Full earnings coverage: Nvidia stock soars toward all-time high as AI push leads executives to predict record revenue

That is a rather typical path for large jumps in tech spending: Companies that make the necessary hardware see gains before the companies that use that gear can develop offerings that take advantage of it. Other gear makers joined Nvidia in the sharp move higher in after-hours trading Wednesday, including AMD, which gained more than 10%; chip maker Marvell Technology Inc.
MRVL,
-1.31%,
which increased more than 5%; and networking specialist Arista Networks Inc.
ANET,
+0.53%,
which added about 5%.

Alphabet and Microsoft stocks both increased around 2% in after-hours trading, and software companies that have made AI a core part of their offerings also saw gains. Palantir Technologies Inc.
PLTR,
-3.24%
and C3.ai Inc.
AI,
+2.54%
shares both increased more than 8%, for example.

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May 24, 2023

Here’s how to play oil-industry stocks for long-term growth of 20% or more

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Oil demand is likely to hold up longer than many people expect during the anticipated transition to electric vehicles. And changes in the industry point to oilfield services companies as good long-term growth investments as offshore production ramps up.

Below is a list of oil producers and related companies favored by two analysts who have followed the industry for decades.

U.S….

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May 8, 2023

14 dividend stocks yielding 4% or more that are expected to increase payouts in 2023 and 2024

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If you invest in dividend stocks, you are probably looking for long-term growth to go with the income. Otherwise you might be content to hold one-month U.S. Treasury bills, which yield 4.5% or park your money in an online savings account for a yield close to 4%.

Below is screen of stocks with current dividend yields ranging from 4.14% to 8.46%. What sets these apart from other stocks with high dividend yields is that their payout increases are expected to accelerate in 2023 and 2024 from those in 2022.

On Tuesday, S&P Dow Jones Indices said in a press release that it expected dividend payments by publicly traded U.S. companies to continue to hit record levels in 2023. But Howard Silverblatt, a senior index analyst with the firm, said that the pace of dividend increases in the first quarter had slowed and that he expected this year’s increases to be “at half the pace of the double-digit 2022 growth.”

Silverblatt also said current events in the banking industry were “expected to negatively impact future spending from both consumers and companies, which in turn may curtail corporate dividend growth.”

For many banks, there’s another big item on the table. A focus on share buybacks in recent years is very likely to end — this is a use of cash that can raise earnings per share if the share count is reduced, but there can be consequences, especially after a year of rising interest rates that pushed down the market value of banks’ investments in bonds.

In a note to clients on March 16, Dick Bove, a senior research analyst with Odeon Capital, predicted that stock repurchases in the banking industry would be “meaningfully cut back if not flat out eliminated.” He made three general points about buybacks in the banking industry:

Buybacks remove working capital that would otherwise provide returns to a bank.
Buybacks mean a bank’s board of directors is “in favor of flat-out giving capital away to investors that want nothing to do with the bank — they are selling its stock.”
Buybacks do “nothing to increase bank stock prices – many bank stocks are selling at below their prices of five years ago.”

A company might find it much easier to curtail or stop buying back shares to preserve cash than it is to cut regular dividends. Preserving and increasing the dividend over time has been correlated with good performance for stocks over time. These articles provide examples of how dividend compounding is correlated with long-term growth as income streams build up:

Dividend stock screen

The S&P Dow Jones Indices report raises the question of which stocks might buck the trend.

Starting with the S&P 500
SPX,
-0.50%,
there are 71 companies stocks with current dividend yields of at least 4.00% indicated by annual payout rates. Among these companies, 68 increased dividends during 2022, according to data provided by FactSet.

Then we looked at the pace of dividend increases in 2022 and the consensus estimates for dividends paid during 2023 and 2024, among analysts polled by FactSet. Among the remaining 68 companies, there are 29 for which the estimated 2023 dividend increase is higher than the 2022 dividend increase. Narrowing further, there are 14 for which the estimated 2024 dividend increases are higher than the estimated 2023 dividend increases.

Here are the 14 stocks that passed the screen, sorted by current dividend yield:

Company	Ticker	Dividend yield	Dividend increase – 2022	Expected dividend increase in 2023	Expected dividend increase in 2024
Altria Group Inc.	MO, +0.27%	8.46%	4.5%	4.7%	4.9%
Newell Brands Inc.	NWL, -1.19%	7.55%	0.0%	0.1%	0.6%
Boston Properties Inc.	BXP, -0.94%	7.42%	0.0%	0.7%	1.0%
KeyCorp	KEY, -2.22%	6.99%	5.3%	6.7%	6.8%
Prudential Financial Inc.	PRU, +0.17%	6.08%	4.3%	4.7%	4.8%
ONEOK Inc.	OKE, +0.60%	5.87%	0.0%	2.2%	2.4%
Healthpeak Properties Inc.	PEAK, -0.32%	5.54%	0.0%	2.1%	2.2%
Dow Inc.	DOW, -0.53%	5.16%	0.0%	1.1%	2.2%
Iron Mountain Inc.	IRM, -1.00%	4.70%	0.0%	1.8%	5.4%
NRG Energy Inc.	NRG, +1.34%	4.50%	7.7%	7.9%	7.9%
Franklin Resources Inc.	BEN, -0.58%	4.50%	3.6%	4.3%	5.7%
Federal Realty Investment Trust	FRT, -0.53%	4.38%	0.9%	1.7%	2.1%
Ventas Inc.	VTR, -0.57%	4.26%	0.0%	3.3%	5.5%
Kraft Heinz Co.	KHC, +1.42%	4.14%	0.0%	0.7%	0.8%
Source: FactSet

Click on the ticker for more about each company.

Click here for Tomi Kilgore’s detailed guide to the wealth of information available for free on the MarketWatch quote page.

Any stock screen is limited, but can be useful as a starting point or supplement to your own research. If you see any companies of interest, do some research to form your own opinion of how likely they are to remain competitive over the next decade, at least.

Don’t miss: This stock ETF keeps beating the S&P 500 by selecting for quality

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April 5, 2023

The commodity supercycle is still young, these strategists say. Here’s why.

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Be careful what you wish for. U.S. job openings dropped below 10 million, a symbolic sign that the Federal Reserve’s efforts to combat inflation by sapping labor-market demand was working — and U.S. stocks promptly fell. Perhaps the bigger issue is that investors were not willing to push stocks out of the 3,800 to 4,200 range the S&P 500
SPX,
-0.48%
has been trading in for months.

It might not be the most obvious time to be discussing a commodity supercycle, with recession talk growing, but then that’s what makes this call more interesting. Strategists at Wells Fargo investment Institute argue it’s year three of a commodity supercycle, which they say has plenty more room to run.

John LaForge, head of real asset strategy, and Mason Mendez, investment strategy analyst, say commodities are like black holes, in that escaping the gravity of a supercycle is difficult for any individual commodity. They point to this chart, looking at commodity momentum since 1800, plotted in 10-year moving averages, which shows that food, energy and the commodity complex as a whole tend to follow each other around.

Right now nearly all the signs, both technical and fundamental, point to a commodity bull market, they say. The early signs are mostly shifting prices and technical indicators, and the latter signs are more fundamental in nature, like restrained supplies. “The bottom line is that the key early technical indicators are confirming to us that a new supercycle likely began in 2020.”

The analysts went further into depth on what they call washed-out sentiment. They say the process goes something like this: near the end of a commodity bull supercycle, prices go so high that oversupplies become rampant and need to be worked off, which results in investment stopping to flow into production. They say that in both corn
C00,
+0.80%
and gold
GC00,
-0.17%
— not commodities with much in common — supply growth rates have turned negative in recent years. Both showed similar conditions at the start of the last supercycle, in 1999.

They advise using commodities as portfolio diversifiers, which certainly would have helped last year, when both stocks and bonds fell but the Bloomberg commodity index rose nearly 16%. They highlight commodity prices typically move differently than stocks or bonds over the long run. And they say that supercycles have historically lasted a decade or longer, and the shortest commodity bull market on record was nine years.

One caveat: the speed of technology advances. Sometimes technology can help fuel demand, but conversely, to the extent technology can make commodities easier to extract, it can also buoy supplies. The obvious example here, not pointed out in the note, is the shale-oil revolution. There’s an interesting article in The Economist (subscription required), how copper has yet to be the beneficiary of a technology boost.

The market

U.S. stock futures
ES00,
-0.36%

NQ00,
-1.08%
edged lower. Oil prices
CL.1,
-0.62%
fell but held over $80 per barrel. The yield on the 10-year Treasury
TMUBMUSD10Y,
3.295%
turned lower after the latest jobs data.

For more market updates plus actionable trade ideas for stocks, options and crypto, subscribe to MarketDiem by Investor’s Business Daily.

The buzz

ADP reported a slowdown in private-payrolls growth to 145,000 jobs in March, as well as a slowing pace of pay growth. Shortly after the open comes the the Institute for Supply Management’s services index. Cleveland Fed President Loretta Mester said interest rates would need to be increased “somewhat” from here.

Overseas, New Zealand’s central bank made a larger-than-expected 50 basis point rate hike, while a joint forecast of Germany’s leading institutes upgraded its view on the eurozone’s largest economy, now expecting a 0.3% advance.

Walmart
WMT,
+1.33%
forecast earnings in a range of $5.90 to $6.05 per share for its fiscal year, below the FactSet-compiled analyst estimate of $6.11.

Johnson & Johnson
JNJ,
+3.44%
proposed to pay up to $8.9 billion over 25 years to settle claims connected with cosmetic-talc litigation.

Alphabet’s
GOOGL,
-0.63%
Google says its chips are faster and more power efficient than comparable chips from Nvidia
NVDA,
-3.41%.

Western Alliance Bancorp
WAL,
-16.47%
shares fell in premarket trade after the regional lender detailed the latest losses in its portfolio of loans and securities.

Brandon Johnson was elected mayor of Chicago, the country’s third-largest city. Former President Donald Trump was defiant in a speech to supporters after his indictment.

Best of the web

A popular Fed program is draining funds from the banking system.

Instant videos could be the next leap in artificial-intelligence technology.

OpenAI, the tech company backed by Microsoft
MSFT,
-1.14%,
is facing what is believed to be its first defamation lawsuit over a claim by its ChatGPT chatbot that an Australian mayor served time in prison for bribery.

Top tickers

These were the most active stock-market tickers as of 6 a.m. Eastern.

Ticker	Security name
TSLA, -3.01%	Tesla
AMC, +2.04%	AMC Entertainment
BBBY, -5.09%	Bed Bath & Beyond
GME, -3.44%	GameStop
BUD, +0.34%	Anheuser-Busch InBev
APE, -0.89%	AMC Entertainment preferreds
MULN, -4.85%	Mullen Automotive
NIO, -4.18%	Nio
AAPL, -1.13%	Apple
AI, -14.35%	C3.ai

The chart

Sure, higher gasoline prices naturally drive demand for electric vehicles. But at what point do high electricity prices make it more cost-effective to buy old gas guzzlers? This chart from Barclays breaks it down — roughly, 10 cents per kilowatt hour equates to $1 per gallon. Right now it’s cheaper to fill a car at the pump than recharge at peak hours.

Random reads

Easter means the annual production of a 15,000-egg omelette.

This man was successful in his marriage proposal, at the cost of a one-year ban from Dodger Stadium.

Need to Know starts early and is updated until the opening bell, but sign up here to get it delivered once to your email box. The emailed version will be sent out at about 7:30 a.m. Eastern.

Listen to the Best New Ideas in Money podcast with MarketWatch reporter Charles Passy and economist Stephanie Kelton.

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April 5, 2023

J&J, C3.ai, Albemarle, Walmart, and More Stock Market Movers

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This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers visit http://www.djreprints.com.

https://www.barrons.com/articles/stock-market-movers-88cae2de

Updated April 5, 2023 7:01 am ET / Original April 5, 2023 4:40 am ET

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April 5, 2023

Reduce Fleet Downtime With These 5 Strategies | Entrepreneur

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Opinions expressed by Entrepreneur contributors are their own.

Fleet downtime is a huge problem for any business that operates automobiles. When a vehicle is down for repairs or maintenance, it can result in lost productivity, missed deadlines, and unhappy customers. It can happen in a planned or unplanned manner. Irrespective of the timing or cause, there are strategies or approaches to effectively managing and decreasing fleet downtime. These include the following:

Conduct routine and comprehensive inspection

One vital step toward effectively reducing fleet downtime is conducting routine vehicle inspections.

You can ensure your vehicles are risk-free and compliant by utilizing manual daily vehicle inspection reports (DVIRs) as you take proactive measures to prevent unplanned downtime. However, despite their advantages, they’re time-consuming and prone to errors. Physical forms can get damaged or lost, and it can take hours to get the results to the maintenance team, slowing down the process.

On the other hand, electronic DVIR (eDVIR) enhances efficiency and ensures that drivers provide clarity and accuracy. With this, you can receive inspection results in real-time, eliminating communication holdups between fleet managers and drivers. Any problem encountered is immediately registered in your fleet management software, enabling you to quickly address and sort out the issue.

Effective communication ensures that even though a vehicle has a problem, the maintenance process can start promptly. This allows the vehicle to get back on the road as soon as possible.

Additionally, a frequent reason for unscheduled downtime is a part failure. Thus, a crucial step in parts monitoring is to verify that they’re in good condition during routine quality control.

In some cases, you may encounter a repeated failure of a particular part in several vehicles. Such patterns may go unnoticed and result in unnecessary expenditure if you lack a simple, all-inclusive approach to assessing your fleet’s status.

Furthermore, routine part maintenance allows you to determine the most suitable vehicle parts. For instance, comparing OEM and aftermarket gaskets can help you decide which option is better for your fleet.

By monitoring and tracking your parts in person and through your fleet management software, you can ensure they are in excellent condition, thereby preventing downtime and reducing recurring expenditures.

Utilize fleet management software

You can utilize fleet management software if your fleet businesses struggle to minimize vehicle downtime and keep smooth operations. This tool can help manage inspections, shop operations, driver activities, and preventive maintenance schedules.

This software uses data analytics and reporting features to identify patterns in servicing or breakdowns and determine their underlying causes. You can use this information to predict recurring problems and develop effective mitigation strategies. This approach can help eliminate future issues, reducing downtime and allowing more productive and efficient business operations.

A preventive maintenance schedule lets you stay ahead of routine servicing requirements. Fleet management software can help you set reminders based on specific intervals, such as mileage and usage hours, guaranteeing you never miss a servicing appointment.

Numerous fleets delegate maintenance duties to a third-party service provider. Conventionally, external repair requests are prepared by hand, resulting in blockages and a restricted understanding of vehicle health patterns. On the one hand, automating outsourced maintenance through fleet management software enables you to handle repair tasks efficiently, monitor maintenance trends, and integrate billing, which all contribute to unnecessary downtimes.

Improve service management procedure

Reducing downtime necessitates streamlined and effective management practices. Fleet managers may be surprised to discover that a significant part of the downtime is mainly unrelated to the actual repairs themselves but, rather, the ineffectiveness of the service management procedure.

To ensure the effectiveness of preventative maintenance, all relevant departments must collaborate to optimize their work schedules and tasks. Internally, efficiently utilizing resources to simplify service procedures eradicates any accumulation of work and reduces errors.

Conduct regular driver training

To achieve a profitable fleet, it’s crucial to ensure that the most appropriate drivers are trained to handle your vehicles, reducing breakdowns and unplanned servicing. For one, a well-instructed, well-informed, and self-assured driver is less likely to be involved in a collision.

Ensuring proper driver behavior can contribute to the reduction of fleet downtimes. Undergoing a brief but comprehensive training period, drivers may identify and eliminate detrimental behaviors that adversely affect the vehicles’ performance, such as forceful or sudden gear shifts, aggressive lane changes, and abrupt turns. Getting rid of such habits promotes road safety and reduces strain on the vehicle.

In addition, properly trained fleet drivers can accurately report any issues they encounter while driving. This feature helps you take note of repairs or replacements you ought to carry out promptly.

Select The Right Vehicles

The choice of vehicles for your fleet can significantly impact the frequency of downtime.

That said, go for the most suitable vehicles for their intended purpose. Never make the mistake of deciding solely based on what your competitors use. Also, don’t let the flashy features touted by the industry’s leading brands fool you.

For instance, you need to make your choice based on the carrying capacity you require. Overburdening a vehicle may exacerbate problems, such as wear and tear, and increase the need for repairs. For instance, if you’re running a garbage collection company, you need fleet vehicles that can carry loads of waste materials you expect to deal with.

Furthermore, it’s advisable to choose newer vehicles equipped with advanced technology. These types of vehicles demand less maintenance and can alert you about emerging problems.

Conclusion

Unplanned fleet downtime is a huge stumbling block to maintaining a profitable and efficient business. There are many methods to minimize such occurrences and maximize fleet efficiency. These methods include leasing appropriate vehicles, performing regular inspections, carrying out preventive maintenance, and promoting team member responsibility is essential.

Additionally, effective communication and collaboration between maintenance, operational, dispatch, and administrative teams are a must to ensure maximum fleet operations at all times. Also, consider investing in fleet management technologies to track your fleet vehicles’ conditions more accurately.

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March 31, 2023

Norway’s Oil Fund Has Roughly 1.49% Stake in Credit Suisse, No AT1 Bond Exposure

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By Dominic Chopping

Norway’s sovereign wealth fund had a 1.49% stake in Credit Suisse Group AG at the end of 2022 and a 3.31% stake in UBS Group AG, holdings that remain “approximately unchanged,” it said Monday.

UBS yesterday agreed to take over Swiss rival Credit Suisse for more than $3 billion as regulators pushed for the deal in an effort to calm declining confidence in the global banking system.

Credit Suisse shareholders will receive one UBS share for every 22.48 Credit Suisse shares held, but holders of around $17.3 billion of additional tier 1 bonds, or AT1s, will receive nothing.

Norges Bank Investment Management, the arm of Norway’s central bank that manages the sovereign-wealth fund, commonly known as the oil fund, said that it doesn’t hold any Credit Suisse AT1 bonds.

Write to Dominic Chopping at dominic.chopping@wsj.com

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March 20, 2023

Finastra rolls out asset liability solution amid rising interest rates | Bank Automation News

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Technology provider Finastra is launching an asset liability management solution aimed at helping small- and medium-sized banks with their balance sheet and compliance needs. The cloud-based software-as-a-service (SaaS) solution, named ALM IQ, is a platform-agnostic microservice designed to help banks with data consolidation, operational efficiency and regulatory compliance, according to Finastra. “[Small banks] see that the […]

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Brian Stone

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February 13, 2023

6 cheap stocks that famed value-fund manager Bill Nygren says can help you beat the market

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These are tricky times in the stock market, so it pays to look to the best stock-fund managers for guidance on how to behave now. Veteran value investor Bill Nygren belongs in this camp, because the Oakmark Fund OAKMX he co-manages consistently and substantially outperforms its peers.

That isn’t easy, considering how many fund managers fail to do so. Nygren’s fund beats its Morningstar large-cap value index and category by more than four percentage points annualized over the past three years. It also outperforms at five and…

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January 25, 2023

These 20 stocks were the biggest winners of 2022

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Even during a year in which the S&P 500 index declined 19%, with 72% of its stocks in the red, there were plenty of winners.

Before showing you the list of the best performers in the benchmark index, let’s look at a preview: Here’s how the 11 sectors of the S&P 500
SPX,
-0.25%
performed for the year:

Index	2022 price change	Forward P/E	Forward P/E as of Dec. 31, 2021
Energy	59.0%	9.7	11.1
Utilities	-1.4%	18.9	20.4
Consumer Staples	-3.2%	21.0	21.8
Health Care	-3.6%	17.6	17.2
Industrials	-7.1%	18.3	20.8
Financials	-12.4%	11.9	14.6
Materials	-14.1%	15.8	16.6
Real Estate	-28.4%	16.5	24.2
Information Technology	-28.9%	20.1	28.1
Consumer Discretionary	-37.6%	21.3	33.2
Communication Services	-40.4%	14.3	20.8
S&P 500	-19.4%	16.8	21.4
Source: FactSet

Maybe you aren’t surprised to see that the energy sector was the only one to increase during 2022. But it might surprise you to see that despite the sector’s weighted price increase of 59%, its forward price-to-earnings ratio declined and remains very low relative to all other sectors.

It might also surprise you that West Texas Intermediate crude oil
CL.1,
+2.69%
gave up most of its gains from earlier in the year:

FactSet

The reason investors are still confident in energy stocks is that oil producers have remained cautious when it comes to capital spending. They don’t want to increase supply enough to cause prices to crash, as they did in the run-up to the summer of 2014, after which prices fell steadily through early 2016, causing bankruptcies and consolidation in the industry.

Now the oil companies are focusing on maintaining supply, raising dividends and buying back shares, as Occidental Petroleum Corp.’s
OXY,
+1.14%
chief executive explained in a recent interview with Matt Peterson. Click here for more about Occidental and the long-term supply/demand outlook for oil.

Best-performing S&P 500 stocks of 2022

Here are the 20 stocks in the benchmark index that rose most during 2022, excluding dividends. Proving that there are always exceptions, not all of them are in the energy sector.

Company	Ticker	Sector	Industry	2022 price change
Occidental Petroleum Corp.	OXY, +1.14%	Energy	Oil & Gas Production	117.3%
Hess Corp.	HES, +0.68%	Energy	Oil & Gas Production	91.6%
Marathon Petroleum Corp.	MPC, +0.18%	Energy	Oil Refining/ Marketing	81.9%
Exxon Mobil Corp.	XOM, +1.01%	Energy	Integrated Oil	80.3%
Schlumberger Ltd.	SLB, +1.04%	Energy	Contract Drilling	78.5%
APA Corp.	APA, +1.68%	Energy	Integrated Oil	73.6%
Halliburton Co.	HAL, +1.23%	Energy	Oil & Gas Production	72.1%
First Solar Inc.	FSLR, +0.68%	Information Technology	Semiconductors	71.9%
Valero Energy Corp.	VLO, +0.43%	Energy	Oil Refining/ Marketing	68.9%
Marathon Oil Corp.	MRO, +1.08%	Energy	Oil & Gas Production	64.9%
ConocoPhillips	COP, +1.38%	Energy	Oil & Gas Production	63.5%
Steel Dynamics Inc.	STLD, -0.72%	Materials	Steel	57.4%
EQT Corp.	EQT, -0.12%	Energy	Oil & Gas Production	55.1%
Chevron Corp.	CVX, +0.66%	Energy	Integrated Oil	53.0%
McKesson Corp.	MCK,	Health Care	Medical Distributors	50.9%
Cardinal Health Inc.	CAH, -0.46%	Health Care	Medical Distributors	49.3%
EOG Resources Inc.	EOG, +0.69%	Energy	Oil & Gas Production	45.8%
Enphase Energy Inc.	ENPH, -0.20%	Information Technology	Semiconductors	44.8%
Merck & Co. Inc.	MRK, +0.12%	Health Care	Pharmaceuticals	44.8%
Cigna Corp.	CI, +0.19%	Health Care	Managed Health Care	44.3%
Source: FactSet

Click on the tickers for more information about the companies.

Click here for Tomi Kilgore’s detailed guide to the wealth of information available for free on the MarketWatch quote page.

Don’t Miss: These 20 stocks were the biggest losers of 2022

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December 30, 2022

These 20 energy stocks are worth a look if you think oil prices will soar in 2023

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Harris Kupperman, the president of Praetorian Capital, made a couple of interesting calls heading into 2022. He predicted that stocks of the giant tech-oriented companies that led the bull market would be sold off, and that oil prices would continue to rise through the end of 2022.

The first prediction came true, while the second one for oil prices fizzled. After rising to $130 in March, oil prices have fallen back to where they started the year. Then again, that second prediction still could have made you a lot of money because the share prices of oil companies kept rising anyway.

That leads to a new prediction for 2023 and a related stock screen below.

Here’s a chart showing the movement of front-month contract prices for West Texas Intermediate (WTI) crude oil
CL.1,
-0.62%
since the end of 2021:

FactSet

Even though Kupperman didn’t get his oil price call right, the energy sector of the S&P 500
SPX,
-1.20%
was up 60% for 2022 through Dec. 27, excluding dividends. That is the only one of the 11 S&P 500 sectors to show a gain in 2022. And the energy sector is also cheapest relative to earnings expectations, with a forward price-to-earnings ratio of 9.8, compared with 16.7 for the full S&P 500.

WTI pulled back from its momentary peak at $130.50 in early March, but that didn’t reverse the long-term trend of low capital spending by oil and natural gas producers, which has given investors confidence that supplies will remain tight.

Vicki Hollub, the CEO of Occidental Petroleum Corp.
OXY,
-3.50%
— the best-performing S&P 500 stock of 2022 — said during a recent interview that there was “no pressure to increase production right now,” citing a $40 per barrel break-even point for oil prices.

Kupperman now expects strong demand and low supplies to push oil as high as $200 a barrel in 2023.

At the end of November, these 20 oil companies stood out as reasonable plays for 2023 based on expectations for free-cash-flow generation and dividend payments.

For this next screen, we are only looking at ratings and consensus price targets among analysts polled by FactSet.

There are 23 energy stocks in the S&P 500, and you can invest in that group easily by purchasing shares of the Energy Select SPDR ETF
XLE,
-2.24%.
We can expand the list of large-cap names by looking at the components of the iShares Global Energy ETF
IXC,
-1.91%,
which holds all the energy stocks in the S&P 500 plus large players based outside the U.S.

The top five holdings of IXC are:

Company	Ticker	Country	% of portfolio	Share “buy” ratings	Dec. 27 price	Price target	Implied 12-month upside potential
Exxon Mobil Corp.	XOM, -1.64%	U.S.	16.4%	54%	110.19	118.89	7.89%
Chevron Corp.	CVX, -1.48%	U.S.	11.5%	54%	179.63	190.52	6.06%
Shell PLC	SHEL, -0.70%	U.K.	7.8%	83%	23.67	29.82	25.99%
TotalEnergies SE	TTE, -1.40%	France	5.6%	62%	59.63	64.40	8.00%
ConocoPhillips	COP, -2.67%	U.K.	5.4%	83%	118.47	140.84	18.88%
Source: FactSet

Prices on the tables in this article are in local currencies.

IXC holds 51 stocks. To expand the list for a stock screen, we added the energy stocks in the S&P 400 Mid Cap Index
MID,
-1.24%
and the S&P Small Cap 600 Index
SML,
-1.89%
to bring the list up to 91 companies, which we then pared to 83 covered by at least five analysts polled by FactSet.

Here are the 20 companies in the list with at least 75% “buy” or equivalent ratings that have the most upside potential over the next 12 months, based on consensus price targets:

Company	Ticker	Country	Share “buy” ratings	Dec. 27 price	Price target	Implied 12-month upside potential
EQT Corp.	EQT, -7.82%	U.S.	83%	36.34	59.14	63%
Green Plains Inc.	GPRE, -2.72%	U.S.	80%	29.80	43.40	46%
Cameco Corp.	CCO, +0.33%	Canada	100%	30.48	44.25	45%
Talos Energy Inc.	TALO, -8.40%	U.S.	86%	19.77	28.67	45%
Ranger Oil Corp. Class A	ROCC, -6.22%	U.S.	100%	41.33	58.00	40%
Tourmaline Oil Corp.	TOU, -4.92%	Canada	100%	71.40	98.83	38%
Civitas Resources Inc.	CIVI, -4.06%	U.S.	100%	58.82	80.83	37%
Inpex Corp.	1605, -2.08%	Japan	88%	1,477.00	1,965.56	33%
Diamondback Energy Inc.	FANG, -2.26%	U.S.	84%	137.58	181.90	32%
Santos Limited	STO, -3.12%	Australia	100%	7.20	9.26	29%
Matador Resources Co.	MTDR, -3.98%	U.S.	79%	57.59	73.75	28%
Targa Resources Corp.	TRGP, -2.63%	U.S.	95%	73.89	94.05	27%
Cenovus Energy Inc.	CVE, -2.55%	Canada	84%	26.24	33.22	27%
Shell PLC	SHEL, -0.70%	U.K.	83%	23.67	29.82	26%
Ampol Limited	ALD, -2.89%	Australia	85%	28.29	35.01	24%
EOG Resources Inc.	EOG, -3.54%	U.S.	79%	132.08	157.52	19%
ConocoPhillips	COP, -2.67%	U.S.	83%	118.47	140.84	19%
Repsol SA	REP, -0.66%	Spain	75%	15.05	17.88	19%
Halliburton Co.	HAL, -3.03%	U.S.	86%	39.27	45.95	17%
Marathon Petroleum Corp.	MPC, -1.97%	U.S.	76%	116.82	132.56	13%
Source: FactSet

Click on the tickers for more information about the companies.

Click here for Tomi Kilgore’s detailed guide to the wealth of information available for free on the MarketWatch quote page.

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December 28, 2022

Tag: Asset management

The junk-bond maturity wall.

This week in earnings

The call to put on your calendar

The number to watch

How are stock-index futures trading

What’s driving markets

Dividend stock screen

The market

The buzz

Best of the web

Top tickers

The chart

Random reads

Conduct routine and comprehensive inspection

Utilize fleet management software

Improve service management procedure

Conduct regular driver training

Select The Right Vehicles

Conclusion

Best-performing S&P 500 stocks of 2022