The markets aren’t incredibly predictable right now and the typical hot stocks aren’t establishing leadership yet. But that doesn’t mean there aren’t stocks that are worth buying.
The hot stocks featured here aren’t likely household names, but if you follow my articles with any regularity, many of these may be familiar. These stocks have been doing very well during this mess, largely because they are very focused companies that have been delivering their products to customers reliably for decades.
And many of these companies are at the front of the economic chain, helping drive their industries forward without much fanfare from individual consumers.
Many of these companies have been soaring year-to-date (YTD) due to increased demand in their sectors and continually rising prices for their goods and services. But this is a great time to use volatility to your advantage and make a move on these companies when the market turns down again. Because it will turn down again.
Start adding on the dips and you’ll have quite a collection when the volatility ends.
| Ticker | Company | Current Price |
| BLDR | Builders FirstSource | $63.94 |
| CF | CF Industries | $95.78 |
| CVE | Cenovus Energy | $23.49 |
| ICL | ICL Group | $10.73 |
| LNTH | Lantheus Holdings | $67.64 |
| SQM | Sociedad Quimica y Minera de Chile | $101.31 |
| WIRE | Encore Wire Corp | $124.54 |
Builders FirstSource (BLDR)
Even as interest rates rise, builders continue to build. This isn’t unusual. And given all the mixed signals we’re seeing in the global economy, it makes perfect sense.
The economy is overheating (that goes well beyond the U.S.) and we’re sitting at record low levels of unemployment. These aren’t terrible things. So for now, building will continue.
And that means Builders FirstSource (NYSE:BLDR) will continue to be a hot stock. It has built a significant footprint supplying builders and developers with the products and services the industry needs to keep up with demand.
BLDR stock has been hit hard YTD, losing 24%. But BLDR has still gained 44% in the past 12 months. And that selloff has certainly helped its valuation. Its price-to-earnings ratio is now under 6x.
This stock has an A rating in my Portfolio Grader.
CF Industries (CF)
Although CF Industries (NYSE:CF) has a $21 billion market cap, it’s likely most investors haven’t heard of it before. Well, now is the perfect time to get to know CF.
It’s a fertilizer company that focuses on nitrogen, ammonia and urea. It also produces ammonium nitrate. These are key products for the agricultural industry around the globe.
CF is a U.S.-based company and has been in business since 1946. It first built a strong relationship with famers in the Midwest and eventually farmers well beyond U.S. shores. Its legacy is also proof that it can weather the booms and busts of the agricultural sector and continue to grow.
CF stock has gained 35% YTD and 73% in the past year. Yet it’s still trading at a P/E just above 12x and has a 1.7% dividend.
This stock has an A rating in my Portfolio Grader.
Cenovus Energy (CVE)
Usually in high-profile industries it’s fairly easy to know who the big players are. Everyone talks about them and they end up as the poster children for their respective industries. Energy (NYSE:CVE) has somehow avoided that high-profile status.
But that doesn’t mean it shouldn’t be considered one of the energy patch’s hot stocks. This Canada-based company has been an energy pioneer. It started operations in 1881. Oil was discovered in the U.S. in Titusville, Pennsylvania in 1859.
That means CVE wasn’t far behind in its drive to commercialize oil production in Canada. And the fact that it remains a thriving company with a $43 billion market cap is testament to the management of the company over all these decades.
CVE stock has risen 85% YTD and 163% in the past 12 months. Yet it still has a decent P/E and a 1.5% dividend. But this is a growth story right now, and continued North American demand is going to boost this stock’s fortunes.
This stock has an A rating in my Portfolio Grader.
ICL Group (ICL)
When it comes to mining and producing important industrial commodities, much of that work is done abroad, even by most big U.S. chemical and materials companies.
However, ICL Group (NYSE:ICL) is an Israel-based company that has a significant global presence, especially in the bromine, potash and magnesium markets. It has mines in Israel — the Negev desert in particular — as well as a number of other countries around the world. Many of its mined chemicals are important components of fertilizers, energy storage and the food industries.
All these sectors are showing increasing demand intermediate and long term. And given its strategic headquarters, it has easy access to Europe, Asia and Africa.
ICL stock has a $14 billion market cap and has been around since 1968. The stock has risen 9% YTD, and 46% in the past 12 months, yet it has a P/E under 12x.
This stock has an A rating in my Portfolio Grader.
Lantheus Holdings (LNTH)
If there’s one reality that we deal with as we age is the potential onset of cardiovascular disease. Some hardening of the arteries is simply age-related. Some genetic. And some environmental.
All of those factors put heart disease at the top of the CDC’s list on top killers in 2020. And it usually takes one of the top places every year in the U.S. And that stat isn’t unique to the U.S.
Lantheus Holdings (NASDAQ:LNTH) has built its business around diagnostic and therapeutic products and solutions that help healthcare professionals identify disease and improve patient outcomes. Its main line of products are focused on diagnostics for heart, brain, lung and other organs using echocardiography (ECG), nuclear imaging, radiotherapeutics and PET imaging agents.
LNTH stock has a market cap just over $4 billion, but it has been in business since 1956, so it’s a very well established company. That means a lot in the conservative medical sector. It also means LNTH has seen its share of market ups and downs.
The stock has gained a whopping 170% in the past 12 months, and 127% YTD. Demand has been growing as Covid-19 continues to exacerbate chronic and acute conditions.
This stock has an A rating in my Portfolio Grader.
Sociedad Quimica y Minera de Chile (SQM)
Similar to ICL, Sociedad Quimica y Minera de Chile (NYSE:SQM) not only launched in 1968 but it’s also a global player in the chemicals sector. Its name translated is the Chemical and Mining Society of Chile. And that’s exactly what it is.
One of the chemicals it mines is lithium. SQM is on of the world’s largest suppliers of lithium because Chile has significant lithium reserves. This is important not only for the production of energy storage for electric vehicles and renewables, but it’s also in the U.S.’s sphere of influence.
China has major lithium deposits, but considering the strategic games at play between the U.S. and China, having access to non-Chinese lithium is essential. SQM makes that a reality. Its fertilizer segment is also firing on all cylinders.
That’s why SQM stock has soared 124% in the past 12 months, and 97% YTD. And it’s why SQM is on our hot stocks list. SQM also still has a 3% dividend yield. Buy in slowly over time.
This stock has an A rating in my Portfolio Grader.
Encore Wire Corp (WIRE)
When it comes to nearly any type of construction, telecom or infrastructure project the one thing they all have in common is wire. That is also true for numerous consumer devices and durable goods as well.
And that’s precisely what Encore Wire Corp (NASDAQ:WIRE) produces: wires of all types for commercial and industrial use. This may seem like a relatively simple business, but it’s as complex and diverse as say, glass manufacturing.
WIRE isn’t a big firm. It has a $2.5 billion market cap, but it’s a very strategic company that should benefit from economic expansion. The stock has gained 49% in the past 12 months, but has lost 12% YTD due to rate increases, among other issues. It’s on the hot stocks list because it’s now on sale and will win big in coming quarters.
This stock has an A rating in my Portfolio Grader.
On the date of publication, Louis Navellier has positions in BLDR, CF, CVE, ICL, LNTH, SQM and WIRE in this article. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.