The retail sector which has been struggling to get back on its feet is likely to witness the best sales this holiday season, according to the National Retail Federation (“NRF”). Retailers too are looking forward to make the most of important days like Black Friday, Cyber Monday and Christmas Eve.
After taking a bad hit during the peak of the pandemic last years, the retail sector has somewhat bounced back it still has a long way to go to get back to the pre-pandemic levels. That might just become a shade easier with this holiday season expected to give a big push to sales.
Holiday Sales Expected to Rise
According to the NRF, holiday season sales this year are expected to break all previous records during November and December and grow 8.5% to 10.5% to between $843.4 billion and $859 billion year over year. Holiday sales had grown 8.2% in 2020 to hit a record of $770 billion.
Last year, holiday sales were good despite the pandemic creating havoc. However, with more people being vaccinated and the restriction eased, sales are likely to see a further jump, shattering all previous records.
Retailers too are hopeful about sales getting a massive boost during this period, which has seen them going on a hiring spree. According to the NRF, retailers are expected to hire between 500,000 and 665,000, seasonal workers compared to 486,000 hired in 2020.
E-commerce to Drive Sales
E-commerce had played an important role last year in driving sales. In fact, this has been the trend over the past few years but last year millions relied on e-commerce as the pandemic had prevented them from stepping outdoors and several brick-and-mortar stores too remained closed.
With the pandemic far from over and people finally having realized the comfort of shopping online, the NRF predicts online and other non-store sales to jump 11% to 15% to between $218.3 billion and $226 billion compared to $196.7 billion in 2020.
Rising income coupled with stronger-than-ever savings are making people spend more, which is likely to help sales this time around.
Moreover, the holiday season this time is starting early, with many retailers having begun holiday sales as early as September. Also companies like
Amazon.com, Inc. ( AMZN Quick Quote AMZN - Free Report) are securing additional space for storage of products, anticipating higher demand. Our Choices
Given this scenario, it would be ideal to invest in retail stocks with a strong online presence. We have hand-picked six stocks for you. Each of the stocks carries a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see
the complete list of today’s Zacks #1 Rank stocks here. Boot Barn Holdings, Inc. ( BOOT Quick Quote BOOT - Free Report) operates as a lifestyle retail chain devoted to western and work-related footwear, apparel and accessories. The company's products include boots, denim, western shirts, cowboy hats, belts and belt buckles, and western-style jewelry and accessories.
The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings improved 36% over the past 60 days. Boot Barn Holdings carries a Zacks Rank #1.
Levi Strauss & Co. ( LEVI Quick Quote LEVI - Free Report) designs and markets jeans, casual wear and related accessories for men, women and children under the Levi's, Dockers, Signature by Levi Strauss & Co. and Denizen brands.
The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings improved 8.2% over the past 60 days. Levi Strauss sports a Zacks Rank #2.
Best Buy Co., Inc. ( BBY Quick Quote BBY - Free Report) is a multinational specialty retailer of consumer electronics, home office products, entertainment software, communication, food preparation, wellness, health, security, appliances and related services.
The company’s expected earnings growth rate for next year is 26.9%. The Zacks Consensus Estimate for current-year earnings improved 2.7% over the past 60 days. The company has a Zacks Rank #2.
Costco Wholesale Corporation ( COST Quick Quote COST - Free Report) sells high volumes of food and general merchandise (including household products and appliances) at discounted prices through membership warehouses. It is one of the largest warehouse club operators in the United States. The company also operates e-commerce websites in the United States, Canada, the United Kingdom, Mexico, Korea, Taiwan, Japan and Australia.
The company’s expected earnings growth rate for the current year is 7.4%. The Zacks Consensus Estimate for current-year earnings improved 4% over the past 60 days. The company has a Zacks Rank #2.
Macy's, Inc. ( M Quick Quote M - Free Report) is in the process of a complete makeover and has outlined plans under its three-year Polaris Strategy to adapt better to the new retail ecosystem. Notably, the company is banking on Backstage locations, Vendor Direct, Store Pickup, Loyalty Program, Growth150 stores, the mobile first strategy and Destination Businesses.
The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings improved 0.5% over the past 60 days. The company sports a Zacks Rank #1.
Tilly's ( TLYS Quick Quote TLYS - Free Report) is a specialty retailer in the action sports industry selling clothing, shoes and accessories. The company distributes t-shirts, sweatshirts, jackets, shorts, pants, jeans, sweaters, swimwear, shoes and accessories for men, women and kids through its website.
The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings improved 26.9% over the past 60 days. It has a Zacks rank #1.