Stocks That Will Make You Rich: A key phrase is included every time investment returns are published: past performance does not guarantee future results. That disclaimer is a must because the market is constantly changing.
Stocks that delivered exceptional growth under one set of conditions can drop sharply when the economic variables change. Interest rate ups and downs, trade wars, and conflicts in remote parts of the world can have unexpected effects on individual companies, entire industries, or the market as a whole.
The COVID-19 pandemic and its eventual containment is a recent example of unpredictable market conditions. In early 2020, COVID sent employees and students home. A variety of tech companies were suddenly in high demand, and their stocks enjoyed tremendous growth.
Zoom became the go-to communication tool for quarantined friends, remote learners, and virtual workers. In a matter of months, Zoom stock went from less than $70 per share to nearly $560 per share.
Peloton at-home fitness equipment and related virtual resources replaced gyms, fitness classes, and sports. Peloton stock increased from around $30 per share in January 2020 to more than $160 per share by the end of the year.
However, those high returns were short-lived. As the pandemic came under control, demand for virtual tools and services dropped – and so did tech stocks. In 2022 alone, Zoom stock lost 35 percent of its value and Peloton stock went down more than 70 percent.
The tech-heavy Nasdaq is down over 25 percent year-to-date, and there is no indication that the losses have bottomed out. In other words, investors who based their trades on the fastest-growing stocks in 2020 and 2021 haven’t achieved the returns they were hoping for. In fact, they have lost money.
The stocks that will make you rich in 2022 may not be the same ones that performed well in the past. Today’s winners are the stocks that will thrive in an inflationary environment. These are three categories that look promising for the remainder of the year, along with the individual companies within those categories that are well-positioned to deliver for shareholders.
Are Energy Stocks Inflation-Proof?
The world’s energy needs are growing faster than ever. Developed countries are using more power as digital tools and services expand, and emerging nations connect more people to electricity and the internet every day. Companies that produce energy from any source – oil, natural gas, solar, wind, etc. – don’t have to worry about a drop in demand. Instead, their biggest concern is producing enough energy to meet global needs.
The invasion of Ukraine and subsequent sanctions on Russian exports disrupted the world’s energy supplies. Oil prices spiked, which immediately increased the cost of many goods and services.
The biggest beneficiaries of increased energy prices and the resulting inflation are energy companies. Many have made record-breaking profits since the start of the year.
Examples of energy stocks that are inflation-proof and expected to deliver impressive returns through the remainder of the year include:
CVR Energy – up 67 percent year-to-date
NexTier Oilfield Solutions – up 104 percent year-to-date
Occidental Petroleum – up 85 percent year-to-date
PBF Energy – up 90 percent year-to-date
Scorpio Tankers – up 141 percent year-to-date
How Does Inflation Affect The Healthcare Industry?
Healthcare costs have gone up each year regardless of market conditions. Accidents, short-term illnesses, and chronic diseases don’t wait for inflation to level off, and no one is willing to accept a less expensive treatment if it is less effective. As a result, healthcare companies that are otherwise financially sound tend to weather economic storms with ease. That makes healthcare stocks a smart choice to keep portfolios stable.
Within the healthcare industry, there are dozens of specialties. Some companies provide direct care, while others produce equipment and services to support providers. The healthcare stocks that will make you rich in 2022 aren’t necessarily the established companies that deliver steady returns year after year. Instead, consider strong companies that put their money into researching and developing innovative products and services that will take healthcare to the next level.
Lantheus Holdings is one example of a company that is committed to accelerating the future of medicine. Its primary field is diagnostic imaging technology.
The recent introduction of its Pylarify PET imaging agent – a tool for diagnosing and treating prostate cancer – has been a tremendous success. The new agent offers physicians a more precise, detailed image, improving their ability to create the best possible treatment plan.
The success of Pylarify, coupled with a dramatic rise in sales of Lantheus’ Definity diagnostic ultrasound enhancing agent, has made Lantheus stock a winner in 2022. So far, it is up 140 percent year-to-date, and all signs point to continued growth.
Pharmaceutical companies are also known for delivering outsized returns regardless of market conditions, assuming they have a proprietary drug that offers proven benefits for tough-to-treat conditions. Some of the fastest growing pharmaceutical stocks include:
Amphastar Pharmaceuticals – up 60 percent year-to-date
Eli Lilly and Co. – up 22 percent year-to-date
Evolus – up 80 percent year-to-date
SIGA Technologies – up 90 percent year-to-date
Which Consumer Staples Stocks Will Rise in 2022?
Energy and healthcare are two of the largest expenses that consumers must fit into their budget regardless of circumstances. However, dozens of smaller expenses also fit into the must-have category, including food and personal care products.
Companies that sell food are in a solid position to withstand economic ups and downs, especially when their business model is built around keeping the final price that customers pay as low as possible.
Companies focused on personal care items, such as bathing essentials, dental care supplies, and makeup, tend to be inflation-proof. Consumers demonstrate brand loyalty when it comes to these purchases, and they are willing to pay a little more for their preferred products.
Costco is a formidable contender in the consumer staples space. Customers pay a reasonable annual membership fee in exchange for access to bulk discounts on food, toiletries, and household goods. At the moment, Costco is especially popular for its member discounts on gasoline, which are relieving some of the burden of higher gas prices.
So far, 2022 has been a good year for Costco. Sales are up more than 17 percent. The stock price faltered early in the year, but it is back on track now. Industry experts expect Costco stock to recover by the end of the year, which makes Costco stock a buy.
Other consumer staples stocks to consider for 2022 include:
Coca-Cola – up 5 percent year-to-date
Kroger – up 6 percent year-to-date
Pilgrim’s Pride – up 8 percent year-to-date
Sysco – up 11 percent year-to-date
Stocks That Will Make You Rich In 2022: The Bottom Line
There are certain goods and services that consumers prioritize, no matter how high prices go. When inflation is high, companies that produce energy, provide healthcare, and distribute food and hygiene products are smart bets to ensure peak portfolio performance.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.