While the stock market endured incredulous turmoil this year, the energy sector remained an outperformer. The S&P 500 Energy ETF (XLE) soared 56.9% year-to-date versus the S&P 500’s 19.3% year-to-date decline. According to FactSet data, energy stocks have the highest ‘buy’ ratings from analysts.
Although oil prices have been on a downtrend recently, that isn’t swaying the energy bulls. Some analysts see it finding a floor with the war dragging on, a rebound in demand from China, and potential OPEC production cuts. Ben Cook, a portfolio manager at Hennessy Funds, expects the sector to continue the outperformance and attain a ‘three-peat’ next year.
