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Best-Performing Stocks of the Top ETF of March

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·4 min read
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SPDR S&P Oil & Gas Exploration & Production ETF XOP topped the list of the best-performing U.S. equity ETFs in March, gaining about 23%. The rally was driven by rising oil prices on supply disruptions and unprecedented demand.

Although most of the stocks in XOP’s portfolio have delivered strong returns this year, a few have gained more than 35%. These include Comstock Resources Inc. CRK, PBF Energy PBF, CVR Energy CVI, EQT Corporation EQT and Southwestern Energy Company SWN.

Oil price roared in March as the conflict between Russia and Ukraine has sparked fears of global supply disruption in an already tight-supply market. Western countries have slapped severe sanctions against Russia over Ukraine that has disrupted trade flows. Sanctions by the United States and other countries will force Russia to supply less crude or natural gas that would have substantial implications on oil prices and the global economy. Russia accounts for one in every 10 barrels of oil consumed globally (read: 5 Sector ETFs That Crushed the Market in Q1).

In fact, the United States has banned all Russian oil and gas imports while the UK will phase out Russian oil by the end of 2022. The European Union, which gets a quarter of its oil and 40% of its gas from Russia, said it will switch to alternative supplies and make Europe independent from Russian energy "well before 2030." Germany halted the approval of a major gas pipeline project, Nord Stream 2, in Russia.

However, new lockdowns in Shanghai have prompted fears of a slowdown in energy demand, thereby leading to a drop in oil prices lately. Another round of peace talks between Ukraine and Russia slated for this week also weighed on prices.

Let’s take a closer look at the fundamentals of XOP.

XOP in Focus

SPDR S&P Oil & Gas Exploration & Production ETF provides exposure to oil and gas exploration and production companies by tracking the S&P Oil & Gas Exploration & Production Select Industry Index. It holds 61 stocks in its basket with each making up for no more than 2.7% of assets.

SPDR S&P Oil & Gas Exploration & Production ETF has AUM of $5.7 billion and trades in an average daily volume of 11.3 million shares. The fund charges 35 bps in fees per year and has a Zacks ETF Rank #3 (Hold) with a High risk outlook (read: 4 Sector ETFs to Win From February Inflation Report).

Below we have highlighted the above-mentioned five stocks in the ETF with their respective positions in the fund’s basket:

Best Performing Stocks of XOP

Comstock Resources is an independent oil and gas exploration and production company. It is engaged in the acquisition, exploration and development of oil and gas properties. Comstock Resources has an estimated earnings growth rate of 87.9% for this year. The stock makes up for 1.6% share in the FCG basket and has soared 49.1% in a month.

Comstock Resources carries a Zacks Rank #2 (Buy) and a VGM Score of A.

PBF Energy is a leading refiner of crude. It provides end products that comprise heating oil, transportation fuels, lubricants and many related products through five oil refineries and associated infrastructure in the United States. PBF Energy has an estimated earnings growth rate of 168% for this year.

PBF Energy has soared about 48% in March and makes up for a 1.9% share in the XOP basket. The stock has a Zacks Rank #1 (Strong Buy) and a VGM Score of B. You can see the complete list of today’s Zacks #1 Rank stocks here.

CVR Energy is an independent refiner and marketer of high value transportation fuels and, through a limited partnership, a producer of ammonia and urea ammonia nitrate fertilizers. The stock has jumped 43.6% this month and accounts for a 0.5% share in the ETF.

CVR Energy has an estimated earnings growth rate of 175.3% for this year. It has a Zacks Rank #2 and VGM Score of A.

EQT Corporation is primarily an explorer and producer of natural gas, with primary focus on the Appalachian Basin in Ohio, Pennsylvania and West Virginia. The stock has rallied 40% in March and makes up for 2.7% of the XOP portfolio.

EQT Corporation has estimated earnings growth of 126% for this year. It has a Zacks Rank #3 and VGM Score of A.

Southwestern Energy engages in the exploration, development and production of natural gas, crude oil and natural gas liquids in the United States. The stock is up 38% in a month and has an estimated earnings growth rate of 33.3% for this year.

Southwestern Energy currently carries a Zacks Rank #3 and has a VGM Score of A. It accounts for a 2.7% allocation in the XOP basket.


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Comstock Resources, Inc. (CRK) : Free Stock Analysis Report
 
EQT Corporation (EQT) : Free Stock Analysis Report
 
Southwestern Energy Company (SWN) : Free Stock Analysis Report
 
CVR Energy Inc. (CVI) : Free Stock Analysis Report
 
PBF Energy Inc. (PBF) : Free Stock Analysis Report
 
SPDR S&P Oil & Gas Exploration & Production ETF (XOP): ETF Research Reports
 
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