New investors should become familiar with the various kinds of stocks and their classifications within the market. GARP is an acronym that stands for growth at a reasonable price. Some stocks on the exchange have taken a beating under the harsh financial environment of 2022, and it's forced their prices to drop to unfair lows. It's a type of dislocation that can occur. Garp stocks offer the characteristics of filtering out overvalued companies which are the most volatile for incurring steep losses in rough and tumble market conditions. They offer a value with a higher potential for growth for investors, offering below-the-market forward price-to-earnings ratios and estimates of growth that are at least ten percent or more for the fiscal year. These reasonably priced stocks come with earnings growth expectations that could reach double digits in the year to come. If this sounds like an investment strategy that fits in with your current portfolio, here are ten GARP stocks worth considering for 2022.
Nasdaq explains that Huntsman is a company based in Woodlands, Texas. it is the largest producer of chemical products in the differentiated and commodity market. It produces a diverse range of products for consumers and industrial applications. Some of the products manufactured by Huntsman include surfactants, epoxy-based polymer formulations, chemicals and dyes for textiles, maleic anhydride, amines, propylene oxide, polyols, MDI, and others. Huntsman's historical long-term growth rate is an impressive 12.3 percent and it achieved a B value score with a rank of 1 from Zacks.
9. Imperial Oil
Imperial Oil is among Canada's largest integrated oil companies with its base in Calgary. It produces oil and gas along with the refining and marketing of petroleum products with a chemical business. It's the largest supplier of jet fuel in Canada and one of the nation's largest asphalt producers. The company is a subsidiary of Exxon Mobil Corporation. Exxon holds an ownership stake of 69.6 percent in Imperial Oil. The growth rate for the next five years is estimated to reach 30.3 percent. The current value score assigned is B with a number one rating by Zacks.
APA is an American independent energy company based in Houston, Texas. APA is actively engaged in the exploration, development, and production of natural gas liquids, and crude oil. It's one of the largest operations of its kind in America. It holds operations in the North Sea of the United Kingdom, Egypt, and the United States with offshore acreage in Suriname, South America, along with holdings in other locations throughout the world. APA is classified as GARP stocks with a value score of B with a number 2 rank for its discounted P/E and PEG with an expected long-term growth rate of 26.5 percent.
7. Pilgrim's Pride
Pilgrim's Pride is an American company headquartered in Greeley, Colorado. It engages in the organic prepared foods industry, offering products certified to not contain antibiotic treatments in the animals from which meats are harvested. The company keeps a finger on the pulse of consumer preferences in food products and aims to meet the demands for healthy and nutritious products. The company has a B value rating with a number one ranking in the discounted P/E and PEG with a long-term investment growth expected to reach 14.9 percent in the year to come.
6. H&R Block
Zacks gives H&R Block a ranking of number one. It's an American company that has grown to become a leader in tax preparation services with DIY tax solutions and other associated products. The company started the year with four-quarter earnings of 21.04 percent. The 2022 fiscal earnings moved to $3.25 per share in 30 days growing by 10.9 percent, giving a strong indication that the stock is experiencing a period of growth.
5. Occidental Petroleum
Occidental Petroleum is listed as OXY on the stock exchange. The company focuses on exploration and production exposure within the integrated oil and gas market. OXY produces various chemicals, petrochemicals, specialty chemicals, and polymers for the market. The average trailing four-quarter earnings growth over rendered a 26.17 percent average with expectations for continued growth with a 30-day move in the right direction of 13.7 percent. It gets a number one rating in the recommended GARP category.
4. East West Bancorp
East-West Bancorp provides commercial and personal banking services to small to medium businesses, professionals, business executives, and other consumers. It specializes in serving as a financial bridge between China and the United States. EArnings over the past 30-days grew by 2.9 percent with a trailing four-quarter earnings of an average of 6.25 percent. East-West Bancorp has an analyst ranking of number two at the present.
Kiplinger recommends considering Freeport-McMoRan stock for the diversification of a portfolio that includes precious metals. The company operates in Africa, Asia, South America, and North America, producing nearly 4 billion pounds of copper, over a million ounces of gold, and 82 million pounds of molybdenum over the past year. It's one of the largest operations of its kind. The market value of Freeport-McMoRan is $52.7 billion with a forward P/E ratio of 9.4 and a B rating, and now is the time to buy. Its largest market is copper. The company saw financial gains over the past couple of years when copper prices rose 65 percent. When the price of copper fell by 15 percent, share prices dropped and are now at 30% of their peak. The company has a strong cash flow of nearly $2 billion. The valuation of FCX is cheap at present, with a strong value grade of B suggesting it's time to buy.
2. ON Semiconductor
ON Semiconductor is a company that designs and manufactures intelligent power and sensing technologies across multiple industries. It serves the medical, aerospace, telecom, and automotive sectors with semiconductors that meet the evolving needs of the EV industry and others. The company is in a superior position in the automotive industry, projecting massive growth in its EV market over the next six years. The projected growth rate is expected to reach 17 percent over the next three years. ON Semiconductor has a market value of $24.5 billion with a forward price to earnings (PE) of 11.5. The EPS achieved over three times in growth for the first quarter of 2021 with forecasts for revenue growth that could reach as high as 65.7%
NVR is an American homebuilder headquartered on the East Coast of the United States. The company builds single-family detached homes, townhouses, and condominiums. NVR owns Ryan Homes and other brands within its massive conglomeration. NVR does not buy land. It secures options to purchase land and only acts when it's time to build a structure. It's one of the best housing stocks on the exchange because of the unique strategies the company employs. It owns factories for building materials and offers consumers faster turnaround times and lower costs. Supply chain issues have not been an issue for NVR because it provides for its needs internally. The market value is $14 billion with an 8.4 forward P/E ratio. The low debt and high growth margin make it an attractive proposition for investors. It gets a B rating suggesting now is the time to buy this GARP stock.
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Written by Allen Lee
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