There's less than a month to go until 2022 is over, and good riddance. As of this writing, the S&P 500 Index is sporting almost a negative 15% return for the year. The Nasdaq Composite index is down nearly 27%. 

It hasn't been all bad, though. A few stocks in my portfolio have actually done quite well this year, and not just on a relative basis. As of this writing, top lithium producer Albemarle (ALB -0.08%) is up nearly 22%, and steakhouse chain Texas Roadhouse (TXRH 0.94%) is up 10%. My third-best performer, Lululemon Athletica (LULU 0.64%), is down just over 1% on the year. 

Here's why I'll be buying more of two of these stocks, and how I'm handling the third I'm not currently buying more of right now.

Albemarle: Lithium demand is sky-high, but supply is coming

My top-performing stock this year is Albemarle, a base materials and chemicals producer that has been around since the 1990s (it was a spinoff from a larger materials company back in 1994). In recent years, though, Albemarle has been whittling down its portfolio to focus on the lithium market, which has been booming as electric vehicle (EV) sales rise sharply. 

My Albemarle purchase was part ancillary bet on the EV and energy storage (mega-batteries used to store power in the energy grid) industries, and part a hedge against high inflation. Lithium is already a commonplace material that rides around in our pockets every day, in the form of small lithium-ion batteries powering our smartphones. But batteries for an EV are exponentially larger, and energy storage batteries even larger still. Thus lithium demand has skyrocketed far beyond supply. Albemarle has been making a fortune as a result, as it was early in positioning itself for the coming demand surge. 

Though it's my top stock of 2022, I'm not adding to my position in Albemarle. Base material producers and mining companies can be highly volatile stocks that can mimic the price of the commodity they sell to their manufacturing customers. Lithium prices are currently near all-time highs. However, a number of other lithium companies are aggressively ramping up supply to cash in too. Higher supply could put a lid on further lithium price inflation. Plus, if a recession hits in 2023 and new car sales dip, EV industry growth could tap the brakes as well. An easing in demand and higher supply could temporarily wreck profit margins for Albemarle and lithium peers. 

Albemarle does sign long-term supply contracts with customers that could help insulate it from a downturn, but I'm content with my position (nearly 2% of my total portfolio) at this point. Things could get bumpy in the next couple of years, but the long-term outlook for lithium stocks is strong as battery technology starts to disrupt the transportation and energy sectors.

Texas Roadhouse: This market-beater surprised me too

The 2022 performance for Texas Roadhouse is proof that timing when to buy and sell stocks can be incredibly difficult at best. As the narrative pivoted from "transitory inflation" to "longer-term inflation" starting in late 2021, I actually considered selling part or all of my Texas Roadhouse position. Though I've been a happy shareholder for years, I feared that higher costs of living would hurt Roadhouse's patrons. 

To be sure, the steakhouse chain certainly has taken some punches, but it has proven capable of absorbing them. Sales have continued to march higher as the company slowly expands its store base across suburban America. And Roadhouse has also boasted rising foot traffic (America loves dining out) and higher guest tickets (driven by gradual menu price hikes based on food inflation). 

With many households moving to the 'burbs and beyond, it seems this eating-out place is picking up more fans, and its existing customer base has proven to be highly resilient against cost-of-living increases. Comparable store sales (or comps, a blend of foot traffic growth and average guest ticket size) went up a whopping 8.2% in Q3 of 2022 at company-owned locations. Earnings per share, which fell in the first half of 2022 as Roadhouse absorbed some of the impact of higher expenses, made a huge rally in the late summer/early autumn quarter as well. 

Along the way, Roadhouse paid its dividend and even doled out a dividend increase for 2022 (the current annual dividend yield sits at 1.9%). Paired with its dividend payments, Texas Roadhouse's total return is at 12% this year, trouncing the S&P 500. I'm happy I chose the difficult path and was patient with this stock. And with growth persisting and inflationary forces starting to show signs of easing, Roadhouse's earnings could be in for a big rally in the coming quarters. I'm considering nibbling a bit more here and buying a few more shares.

Lululemon: A new leader in athleticwear and apparel emerging?

Fast-changing times and economic stress can create new market leaders. It's way too soon to call Lululemon the leader in athletic wear (its revenue over the last trailing 12-month stretch was just over $7 billion compared to over $47 billion for Nike). However, it's time to stop doubting the strength of Lululemon's brand power and take a closer look at how it's continuing to put up incredible growth. 

While the comparisons aren't exact, Lululemon got its start making high-quality products in a small corner of the apparel world, just like Nike did back in the 1960s making track running shoes. For Lululemon, its obsession started in women's yoga pants. Many years ago, I scoffed at the idea of investing in a company that sold "stretchy pants" at a premium, no matter how fast it might be growing. But year after year, Lululemon kept proving my early doubts wrong, and along the way it has built on its strong roots. It now boasts clothing for everyone, all based on its quality fabrics and clothing designs for an active lifestyle. 

Lululemon's expansion into new categories isn't finished, either. It's early on in rolling out shoes and sandals for women. Lululemon has had great success in testing out new products and then going all-in once it's convinced they will be a profitable addition to its lineup. Now, this strategy isn't perfect, and there have been missteps. The acquisition of workout start-up Mirror for $500 million back in 2020 was a steep price tag that may never pay off. Time will tell.

Nevertheless, Lululemon has remained a solid bet in the apparel industry, even in tough years like 2020 through 2022. Revenue has nearly doubled in the last three years, and operating profit margins have continued to hover in the 21%-to-22% range (which is quite good for a clothing retailer; Nike's operating margin is at 13% over the last 12 months).

Thares have rallied recently and are down just 1% so far in 2022. The stock trades for a high premium at 45 times trailing 12-month earnings per share. Nevertheless, given Lululemon's momentum and lucrative business model, I'll continue adding to my position from time to time as we head into 2023.