Hello and welcome to the first post of this New Year 2022!
Materials companies were hit hard in 2021: from
supply chain disruptions due to Covid-crisis, the North American winter storm
(“Uri”) resulting in force majeure at chemical companies in the Texas region,
the Suez Canal blockage after the grounding of Ever Given and global inflation (Eurozone
around 4%; North America around 7%).
However, looking at the financial markets,
things were booming. The S&P 500 finished 2021 with a gain of 27% for the
year and the NASDAQ composite increased 21.4% in 2021. The Vanguard Materials
Index Fund ETF made also 26% in 2021. Altogether, the 11 main sectors were up
double-digits (Energy sector + 46%, Real Estate +41%, Technology +33%,
Financials +32%, Consumer Discretionary +27%, Utilities +14.1%, Consumer
Staples +14.3%, Communication Services +15.1%, and Industrials +19.5%).
How did the 30 major material stock companies
perform in 2021?
25 out of the 30 stocks could make gains for
their shareholders (date of estimation: 02.01.2022) and this is seven more
compared to 2020. AdvanSix (Nylon 6 producer) and Rogers Corp were in the lead
with high double digit gains and above.
 |
| Performance of 30 major material stocks |
As in the beginning already pointed out,
inflation is on the horizon worldwide and prices need to be balanced, together
with optimizing the assets. Demand on resin products will keep going, despite
new Corona-variations. The industry has already two years’ experience to deal
with this pandemic scenario making them more confident to handle the upcoming
demands.
Also interesting to see where analysts see the
potential this year: Energy, Communication Services, and Technology (62%) are
on the buying list. Consumer Staples, Utilities, and Financials have a more
bearish buying outlook.
Thank you for reading and #findoutaboutplastics
Greetings,
Herwig
Literature:
[2] Factset
Earnings Insight
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