Taking stock: Oil and gas companies are up, but homebuilders, tech drop
Rapid changes in the global economy have pummeled the stock market, with the S&P 500 losing 21 percent of its value in the first half of the year.
Not all stocks are struggling, however. The S&P Energy Sector Index, which includes companies such as Occidental Petroleum, Exxon Mobil, Coterra Energy and Valero Energy, gained 29 percent through June. Meanwhile, other sectors showed big declines as inflation and rising interest rates slowed economic growth and cut into consumer spending.
High oil prices, which hit a peak of $123.70 on March 28 as the U.S. banned oil imports from Russia following its invasion of Ukraine in February, have contributed to stock price gains at many Houston energy companies. Oil rebounded from lows near $78 in January and is now trading around $103.
Among Houston’s top gainers, NexTier Oilfield Solutions ended the second quarter at $9.51 with shares more than doubling (168 percent) in the first half of the year.
Shares of energy company and chemical maker Occidental Petroleum, which has captured the attention of billionaire Warren Buffett, closed at $58.88 on June 30, up 103 percent at midyear. CVR Energy, a petroleum refining and marketing company, nearly doubled to $33.50 a share at mid year, up from $16.81 at the end of 2021. Shares of Exxon Mobil were up 40 percent.
Some other sectors, meanwhile, declined.
The S&P 500 Information Technology Sector Index, which includes Houston-based Hewlett Packard Enterprise, Apple and Microsoft, was down by 28 percent at midyear. Shares of HPE were down 16 percent in the first half of the year.
The Dow Jones U.S. Select Home Builders Index, which tracks the performance of companies including builders D.R. Horton, Lennar and PulteGroup as well as building supply companies, tumbled 37 percent in the first half of 2022.
Shares of Houston-based LGI Homes, which builds primarily entry-level homes in 19 states, fell by 44 percent through June.
Rising home prices and mortgage rates are making it more challenging for homebuyers. Mortgage rates averaged 5.3 percent last week for a 30-year fixed-rate mortgage, up from 2.9 percent a year ago, according to the government-sponsored mortgage finance company Freddie Mac. That adds $440 to the monthly payment on a $320,000 loan compared to a year ago.
The S&P 500 Consumer Discretionary Sector Index, which tracks autos, household durable goods and retail and restaurants, was down 33 percent at mid year.
Retailers are having a tough time as they deal with higher transportation costs associated with rising fuel prices and consumers tightening their belts as inflation reached 8.6 percent in May.
Conn’s, a retailer of home electronics, appliances and furniture, had a 66 percent drop in its share price in the first half of the year with shares closing at a 52-week low of $8.02. Conn’s said higher year-over-year supply chain, freight and fuel costs impacted its retail performance.
UPS AND DOWNS
Here are highlights of Houston stocks with some of the largest gains and losses in share price this year through June 30:
NexTier Oilfield Solutions: $9.51, up 168%
Occidental Petroleum: $58.88, up 103% CVR Energy: $33.50, up 99% Patterson-UTI Energy: $15.76, up 87%
Nabors Industries: $133.90, up 65%
Talos Energy:
$15.47, up 58%
MRC Global: $9.96, up 45% Exxon Mobil:
$85.64, up 40%
Coterra Energy: $25.79, up 38% Halliburton: $31.36, up 37% Marathon Oil:
$22.48, up 37% Southwestern Energy: $6.25, up 34%
Cheniere Energy:
$133.03, up 31%
APA Corp.: $34.90, up 30% EOG Resources:
$110.44, up 27% ConocoPhillips:
$89.81, up 26%
NOV: $16.91, up 25%
Baker Hughes:
$28.87, up 20% Schlumberger:
$35.76, up 19%
DECLINERS
Conn’s: $8.02, down 66% LGI Homes:
$86.90, down 44%
IES Holdings:
$30.17, down 40%
Stewart Information Services:
$49.75, down 38%
Howard Hughes Corp.: $68.05, down 33%
Camden Property Trust: $134.48, down 25%
Crown Castle International: $168.38, down 19% Academy Sports + Outdoors: $35.54, down 19% Huntsman Corp.:
$28.35, down 19%
Comfort Systems:
$28.35, down 16%
Hewlett Packard Enterprise: $13.26, down 16%