Back to top

Image: Bigstock

Summer Spending: 3 Stocks Set to Benefit

Read MoreHide Full Article

Summer is just around the corner, with a resilient consumer looking to take full advantage of the warmer months. As we’re all aware, consumers (myself included) typically go on vacations, engage in outdoor activities, and spend cash on other discretionary items throughout the period.

And, of course, several companies are looking to capitalize on spending habits throughout the summer, including Pool Corp. (POOL - Free Report) , Dick’s Sporting Goods (DKS - Free Report) , and Camping World (CWH - Free Report) .

But are they worth consideration before the summer starts heating up? Let’s take a closer look at each.

Pool Corp.

Pool Corp. is the world's largest wholesale distributor of swimming pool supplies, equipment, and related products.

Perhaps to the surprise of some, POOL shares are massive long-term winners, up an unbelievable 13000% over the last 25 years and crushing the S&P 500’s impressive 670% gain. The stock has been the definition of an under-the-radar gem.

Zacks Investment Research
Image Source: Zacks Investment Research

Shares aren’t expensive on a relative basis, with the current 22.4X forward earnings multiple sitting well below the 30.8X five-year median and highs of 36.3X in 2022. Over the last five years, shares have traded as high as 50.6X.

The stock sports a Style Score of “C” for Value.

Zacks Investment Research
Image Source: Zacks Investment Research

Shares also pay a dividend, currently yielding 1.3% annually. Impressively, the company has grown its payout by more than 20% over the last five years, reflecting a shareholder-friendly nature.

Zacks Investment Research
Image Source: Zacks Investment Research

Camping World

Camping World is a provider of services, protection plans, products, and resources for recreational vehicle enthusiasts.

Shares found plenty of buyers following the company’s latest quarterly results, as shown in the chart below.

Zacks Investment Research
Image Source: Zacks Investment Research

Regarding the mentioned quarter, Camping World posted a sizable 600% EPS beat and reported sales marginally below expectations. In addition, the company posted record gross profit performance within used vehicles, helping to explain the dramatic upward move in shares post-earnings.

Zacks Investment Research
Image Source: Zacks Investment Research

And to top it off, CWH shares currently yield 8.6% annually, well above the Zacks Consumer Discretionary sector average. The company’s payout has grown by an impressive 80% just over the last five years.

Zacks Investment Research
Image Source: Zacks Investment Research

Dick’s Sporting Goods

Dick’s Sporting Goods is a significant omnichannel sporting goods retailer, offering athletic shoes, apparel, accessories, and a broad selection of outdoor and athletic equipment for team sports, fitness, camping, fishing, tennis, golf, water sports, etc.

The sports retailer posted results nicely above expectations in its latest release, exceeding our consensus EPS estimate by roughly 5%. Quarterly revenue totaled $2.8 billion, modestly above expectations and improving 5.3% from the year-ago period.

Zacks Investment Research
Image Source: Zacks Investment Research

In addition, shares have recently bounced off the 200-day moving average, an area that’s acted as support in the past. This bullish action is illustrated in the chart below.

Zacks Investment Research
Image Source: Zacks Investment Research

Analysts have become bullish on the company’s current fiscal year, with the $13.48 per share estimate being revised 15% higher since June of last year.

Zacks Investment Research
Image Source: Zacks Investment Research

Bottom Line

With summer looming, consumers will soon be flocking outside and spending on discretionary items.

And several companies, including Pool Corp. (POOL - Free Report) , Dick’s Sporting Goods (DKS - Free Report) , and Camping World (CWH - Free Report) , stand to benefit from the spending trends throughout the period.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Pool Corporation (POOL) - free report >>

DICK'S Sporting Goods, Inc. (DKS) - free report >>

Camping World (CWH) - free report >>

Published in