10 Stocks My Portfolio Is Thanking Me for This Year

Thanksgiving is a time of gathering with family, enjoying some delicious food, and giving thanks. For investors, there’s a lot to be thankful for this year. The S&P 500 is trading at all-time highs, and the bull market has roared again this year with the broad-market index up more than 25%.

In all likelihood, 2021 will be the 12th time in the last 13 years that the index will finish in positive territory.

Plenty of stocks have beaten the market this year. Here are 10 that I own that I’m particularly grateful for.

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Target (NYSE: TGT) is one of my favorite stocks, and it has quietly crushed the market over the past five years, more than tripling. And this year it’s gained 39%, again outpacing the market.

The big-box chain has been doing a lot of things right, including executing a same-day fulfillment strategy that’s driven monster growth, expanding its small-format stores, developing its private-label owned brands, and partnering with traffic drivers like Disney, Apple, Lego, and Ulta Beauty.

Target stock fell on its latest earnings report due to concerns about margin contraction from supply chain issues, but the company is well positioned for the holiday season and beyond.

ALSO READ: 2 Monster Growth Stocks to Buy Now and Hold

GXO Logistics (NYSE: GXO) has been around for only a few months, but the stock has already proven its mettle, up 85% since it was spun off from XPO Logistics in early August. That compares with a gain in the S&P 500 of just 11%.

GXO is the world’s largest pure-play contracts logistics company. It operates nearly 1,000 warehouses for customers like Apple and Abercrombie & Fitch, and it's benefiting from several tailwinds, including e-commerce, outsourcing, and increasing demand for automation. The company has invested significantly in areas like robotics to reduce labor costs and increase efficiencies. And its size puts it in a good position to gain market share, both organically and through acquisitions as it takes advantage of a fragmented industry.

GXO should also benefit from the supply chain crisis as the global economy needs to increase its investments in shipping capacity.

You might be surprised to learn that children’s apparel retailer The Children’s Place (NASDAQ: PLCE) has more than doubled this year, up 107% through Nov. 22. The stock had plunged last year like much of the apparel retail sector, but the company is now more profitable than ever. It has accelerated its store rationalization strategy during the pandemic and derives nearly 50% of its sales from e-commerce, more than almost any other brick-and-mortar apparel retailer.

The company just posted record profits in the third quarter, and the stock looks cheap at a price-to-earnings ratio of less than 10. Considering that, the stock looks well positioned to continue to outperform.

Innovative Industrial Properties (NYSE: IIPR) offers a unique way to get exposure to the cannabis industry. The company doesn’t sell marijuana. It owns growhouse facilities that it leases out to growers.

This makes the company’s business much more reliable than the typical cannabis stock as it has recurring revenue it can collect and it isn’t sensitive to commodity prices.

The company has also benefited from strong growth in the marijuana industry as revenue has nearly doubled this year, and it is solidly profitable. IIP even pays a dividend, currently yielding 2.2%. Year to date, the stock is up 47%.

ALSO READ: The Smartest Stocks to Buy With $350 Right Now

Cloud stocks have mostly struggled this year after the software-as-a-service (SaaS) sector had so much growth pulled forward a year ago. In 2021, its valuations have moderated as investors rotated back into sectors like energy, financials, and real estate that have benefited from the recovery.

However, MongoDB (NASDAQ: MDB) has been an outlier, up 43% this year after jumping in 2020 as well.

Investors can thank the strong growth of Atlas, the company’s cloud-based database-as-a-service product, which has seen incredible growth in recent years. Atlas revenue rose 83% in the most recent quarter and now makes up 56% of the company’s overall revenue.

That performance shows that MongoDB isn’t suffering a recovery hangover like many of its peers, which is a good sign into 2022 and beyond.

5 Stocks Under $49
Presented by Motley Fool Stock Advisor
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!" It's true, but we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Click here to learn how you can grab a copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

Sea Limited (NYSE: SE) is another example of a pandemic winner that has continued to outperform in 2022.

Sea Limited is a diversified tech company based in Singapore. It operates digital video game company Garena, e-commerce platform Shopee, and digital payment service SeaMoney.

Growth at the company has been phenomenal even in the recovery as revenue jumped 121% in the most recent quarter, showing that this is more than a pandemic recovery story.

The video games segment has been the company’s only profitable one. But it is investing heavily in e-commerce as that business is growing rapidly and it’s the leader in Southeast Asia, a logistically difficult region to operate in due to the number of island nations.

Year to date, the stock is up 63%.

Like MongoDB, Bill.com (NYSE: BILL) is another cloud stock that’s rallied both this year and last. The company’s software helps automate back-office accounting and payments for small- and medium-size businesses. Because of its focus on those, its growth has actually accelerated this year, and it’s also benefited from the acquisition of Divvy, an expense management software company.

Bill.com should also see tailwinds from the normalization of the economy as the company collects interest on money it holds for customers while payments are clearing, meaning it will benefit from rising interest rates.

Core revenue jumped 164% in its most recent quarter, and organic revenue was up 78%. That helps explain why the stock is up 120% this year.

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I don’t normally invest in banks or financial stocks, but big banks like Wells Fargo (NYSE: WFC) plunged sharply last year during the pandemic as they took losses for expected bad loans. However, much of those losses never materialized as the economy recovered rapidly and stimulus payments and the Payroll Protection Program helped keep business on their feet.

As a result, Wells Fargo is up 67% year to date, and there are still some catalysts that could drive the stock higher. Last year, the bank slashed its quarterly dividend from $0.50 to just $0.10, but restoring it back to its prior level, which seems likely, would give investors a 4% dividend yield at the current stock price. Additionally, the company will benefit from rising interest rates, as will the rest of the banking sector, and it’s trading at a price-to-earnings ratio of just 12.

Along with Pfizer and BioNTech, Moderna (NASDAQ: MRNA) has been the big winner in the COVID-19 vaccine race, and the company’s booster shot was recently approved, paving the way to further profits.

Year to date, Moderna stock is up 171%.

While its coronavirus vaccine has been the highlight for the stock, and the reason why it’s trading at a P/E of just 11 based on this year’s earnings and next year’s, the company also has some exciting prospects in the pipeline as the company is using the same mRNA technology to develop drugs for diseases like HIV, cancer, and the flu.

A second breakthrough would power the stock to further heights, and there still seems to be a long runway for its COVID-19 vaccine, given the need in the developing world and demand for booster shots.

Most e-commerce stocks thrived in 2020 but have struggled this year as consumers return to normal shopping patterns.

However, that’s not true for apparel e-commerce companies like Revolve Group (NYSE: RVLV) as apparel sales fell sharply as offices were closed and social events put on hold.

Revolve managed its business well during the pandemic, and it's now seeing sales boom in the recovery. Sales jumped 62% in its most recent quarter as the influencer-driven business is benefiting from a return in social activities and the company is stepping up investments in marketing to drive growth. The combination of the reopening tailwinds, pent-up demand, and the broader strength in e-commerce should work to the stock’s advantage.

Year to date, the stock is up 167%.

5 Stocks Under $49
Presented by Motley Fool Stock Advisor
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by The Motley Fool. I’d be sitting on a gold mine!" It's true, but we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Click here to learn how you can grab a copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

Just as 2021 favored a much different group of stocks than 2020, 2022 is likely to see a shift as well. Interest rates are rising, pressuring growth stocks, and the Federal Reserve is expected to begin tightening monetary policy, which could further squeeze growth stocks and favor sectors like energy, financials, and sectors.

Nothing is certain, and the year will bring some surprises, but investors should expect market sentiment to continue to shift as the impact of the pandemic fades and the economy continues to normalize.

Wells Fargo is an advertising partner of The Ascent, a Motley Fool company. Jeremy Bowman owns shares of Bill.com Holdings, Inc., Moderna Inc., MongoDB, Revolve Group Inc, Sea Limited, Target, The Children’s Place, Walt Disney, Wells Fargo, and XPO Logistics. The Motley Fool owns shares of and recommends Apple, Bill.com Holdings, Inc., Innovative Industrial Properties, MongoDB, Revolve Group Inc, Sea Limited, Ulta Beauty, and Walt Disney. The Motley Fool recommends Moderna Inc. and XPO Logistics and recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.