How Energy became the top-performing sector in 2021 - The Hustle
The Hustle

How Energy became the top-performing sector in 2021

For the first time since 2016, Energy is the top-performing sector on the S&P 500 (with Devon Energy leading the way).

It was a shocking sight.

In April 2020 — as COVID-19 fears gripped the world for the first time — the futures price of WTI oil hit -$37.63 (as in negative).

While the price shock didn’t last long, many predicted doom for the energy stocks.

Energy is now on pace to be…

… the top-performing sector on the S&P 500 this year (beating out 10 other sectors including Tech, Consumer, and Health Care). It’s a feat Energy hasn’t accomplished since 2016, per Bloomberg.

While the benchmark S&P 500 is up ~29%, the Energy sector is up ~47%.

The sector’s performance — unsurprisingly — coincides with the rise in oil prices, which jumped over the past year as the world restarted. In October, WTI oil crossed $85 (a 7-year high) and it now sits at $73.

Energy companies are typically classified…

… by their operations, per Investopedia:

Meet the best-performing energy company

Oklahoma-based Devon Energy — which provides upstream oil exploration services — has gained 170%+ in 2021 and is the top stock on the entire S&P 500.

Investors are loving the stock for one big reason, per Bloomberg: It’s “spewing cash” and giving it back to shareholders in the form of dividend hikes and aggressive buybacks.

While WTI oil is currently forecasted to be in the $60s next year, the Energy sector — and appetite for it — are a long way from **checks notes** negative dollars.

Get the 5-minute roundup you’ll actually read in your inbox​

Business and tech news in 5 minutes or less​

Exit mobile version