The Best Performing Energy Stocks Of Q1 2023

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The energy sector was down in Q1, but some companies turned in a decent Q1 performance.

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the New York Stock Exchange opening bell, Monday, Dec. 3, 2018. Marathon was one of the top-performing energy companies in Q1 2023. Last Friday a difficult quarter came to a close. The S&P 500 returned 7.0% for the quarter, but that performance is deceptive. Eight of 11 sectors underperformed the S&P 500 in Q1.

This is primarily because the S&P 500 has a high concentration of technology holdings. That sector — after a miserable 2022 — pulled out an excellent return in Q1, and that skewed the S&P 500 average. The Dow Jones Industrial Average, by contrast, only returned 0.4% for the quarter. The median sector, as shown in the graphic below, was the Real Estate sector, which pulled out a 1.9% Q1 return. The energy sector, which I predicted would underperform this year, turned in the 3rd worst sector performance in Q1.The primary drivers for the energy sector’s underperformance were weakening oil and gas prices. After averaging over $90 a barrel in 2022, Q1 saw oil prices dip below $70/bbl.

— which I use to analyze companies — the average upstream company lost 10.6% in Q1. These are the companies that produce oil and gas. Of the 54 companies that FactSet classifies as “Upstream”, 42 had a negative return in Q1.

 

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