Top of the Oklahoma Inc. 2021 ranking? Energy and banking sectors


This year’s Oklahoma Inc. analysis of publicly traded companies shows clear markers of the effect of the coronavirus pandemic on the economy.

Specifically, experts say, it shows how energy companies have rebounded from shutdowns a year ago that limited transportation and fuel consumption.

Last year, at the height of the pandemic, energy companies were already at the end of a downturn caused by low oil prices. When people stopped traveling, it was a big blow to an already struggling industry.

But now, as the economy tries to extricate itself from the slump caused by the coronavirus pandemic, the outlook for energy companies is improving. The 2021 ranking also shows some stabilization in technology demands and an expectation that the financial sector will ultimately benefit from higher interest rates.

Energy leaders

Jake Dollarhide, CEO of Longbow Asset Management in Tulsa, said fortunes had changed for energy companies after a brief oil crash that sent the market price below zero.

“Energy had no chance of being among the leaders (last year),” Dollarhide said.

Oklahoma Inc.’s 2020 rankings had just four energy companies in the Top 10, none in the Top 5. This year, however, eight of the top 10 companies are operating in the energy sector.

Since last year, manufacturing, service and technology companies have fallen in the rankings despite mostly positive growth.

According to Dollarhide, Paycom, the Oklahoma City-based human capital management software provider, is standing out. Paycom has seen impressive growth over the past few years and consistently ranks top in Oklahoma Inc. Last year Paycom ranked # 1 on the list.

“Paycom is like the Patriots when Tom Brady was playing there, like the New York Yankees when Derek Jeter was playing there,” he said.

This year, however, Paycom ranks 17th on the list, which compares the total return on companies’ stocks, the evolution of income and the evolution of earnings per share.

“It just shows you that technology has given way to energy this year,” Dollarhide said.

Zac Reynolds, chief investment officer at Full Sail Capital, said the reopening of the economy has benefited banks and manufacturers, as well as energy companies.

“US GDP is set to grow at the fastest rate in decades this year, so many companies are seeing increased demand for products and services,” Reynolds said. “Because overseas supply chains have been severely affected by shipping issues, it wouldn’t be surprising to see Oklahoma manufacturers benefit as companies seek to bring production closer to their country. . “

Lining for banks?

Energy companies make up most of the Oklahoma-based public corporations, followed by financial institutions like banks.

The three banks in Oklahoma Inc.’s list, Bank7 Corp., BOK Financial and Bancfirst, remain in the middle of the pack despite the Federal Reserve’s low interest rates, a major source of income.

“Banks also benefit from a growing economy, but low interest rates have been a headwind. There could be some good news on the horizon, however, as the Fed has indicated it could start raising short-term interest rates at the end of 2022 or early 2022. 2023, “Reynolds said Raising interest rates would be a double-edged sword, as it would increase borrowing costs for consumers and businesses and likely hurt house prices, but it could also result in higher profitability for the banks.”

Dollarhide made a similar assessment.

“Banks and financial companies have suffered because lower interest rates don’t give them the ability to have a lot of spread on loans and things like that,” he said.

Staying so high on the list “shows you that bank stocks have started to rise this year because people expect inflation. They expect higher interest rates.”

University of Central Oklahoma economist Linh Pham noted that some of the rankings seem confusing at first. For example, Laredo Petroleum and LSB Industries (ranked second and fourth) posted impressive stock returns while net income was negative.

“I think investor expectations regarding the increase in the oil market could have pushed up stock returns even though the company’s net income hasn’t really caught up,” said Pham, assistant professor of economics at the UCO business school.

Editor-in-Chief Dale Denwalt covers Oklahoma economics and business news for The Oklahoma. Do you have a story idea for Dale? He can be contacted at ddenwalt@oklahoman.com or on Twitter at @denwalt. Support Dale’s work and that of fellow Oklahoman journalists by purchasing a digital subscription today at subscription.oklahoman.com.

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