Today, we are flooded with news of inflation and fears of a recession. While these are real issues that will destroy many companies, there are others in history.
As Mad Money host Jim Cramer puts it, “There’s always a bull market somewhere.”
Even if you decide to stay away from certain stocks, you can find opportunities in others. Here are two industries and shares of the rising market that are receiving strong extreme winds of growth.
The gas industry ignites all the cylinders
Gas is currently trading at almost $ 10, more than 200% higher than last year.
This is easily explained, as there are strong forces of supply and demand. On the demand side, the growing LNG industry has opened the North American gas sector to strong global demand. According to the Energy Information Association, LNG exports increased by almost 20% this year.
On the supply side, North American gas is the cleanest, cheapest, most abundant and most reliable. However, restrictions on North American infrastructure have put pressure on supply, pushing up prices.
In addition, the supply of gas from other countries is completely unreliable, also leading to higher prices.
Chesapeake Energy Corp. (CHK)
This $ 13 billion oil and gas producer has assets in production basins such as Haynesville, East Texas and West Louisiana, and the Marcellus Basin, which stretches from northern New York to Penn State, North Rhine-Westphalia. and Ohio.
Gas accounts for 85% of Chesapeake production – a big plus given the upward trend in the gas industry today.
The company also has a privileged position near the Gulf Coast, where many LNG terminals are located. In fact, more than 2 billion cubic feet of Chesapeake gas are right next to the Gulf Coast LNG terminals.
This translates into a bright future as the company works to secure contracts for its gas at these LNG terminals. This will provide access to higher LNG prices as well as greater diversification.
Similar to most gas producers today, Chesapeake generates huge amounts of cash flow: Management expects to generate more than $ 9 billion in cash flow over the next five years. In its last quarter, it generated $ 532 million in adjusted free cash flow – more than 50% higher than last year and the highest quarterly amount in its history.
Much of this cash flow will be returned to shareholders through dividends and share repurchases, both of which are catalysts for the stock’s upward trajectory.
The digitization trend is driving IT consulting companies higher
As the benefits of digitalization become clearer and clearer, this trend is pushing an upward market in the tech world.
The banking industry, among other industries, is in a hurry to digitize. Obstructed by outdated technology platforms, banks see writing on the wall. Digitization is essential to stay competitive. And the banks are all in.
For example, Citigroup Inc. launches an “aggressive development strategy”. As Jonathon Lofthouse, Head of Markets and Business Risk Technology, puts it, “Companies that can digitize faster will create a competitive advantage.”
CGI Inc. (GIB)
This Canadian IT consulting firm has established itself as a leading player with a strong global presence.
CGI has grown from a startup in 1976 to a $ 17 billion company today.
In this area, the demand from financial institutions is strong and growing rapidly. The last quarter of the CGI has shown strong growth in most sectors, with banks standing out once again.
The company recorded a strong increase in revenue, accompanied by a 14% increase in EPS.
This article provides information only and should not be construed as advice. It is provided without any guarantee.