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4 ETF Areas to Play on Moderately Soft February Retail Sales
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Americans increased their spending a bit in February after pulling back in January. But last month’s gain in retail sales was weaker-than-expected, and January’s decline was revised even lower, indicating that many are growing cautious with their spending ability. Retail sales rose 0.6% in February after falling a revised 1.1% in January, hurt partly by inclement weather, according to the Commerce Department’s report on Thursday.
Below we highlight a few areas and the related ETFs & stocks that may benefit handsomely from the retail sales.
Winning Areas
Food and Drink Places
Sales at restaurants and bars increased 6.3% year over year and 0.4% sequentially.
AdvisorShares Restaurant ETF (EATZ - Free Report) – The AdvisorShares Restaurant ETF is an actively managed exchange-traded fund that seeks to achieve its investment objective by investing at least 80% of its net assets in securities of companies that derive at least 50% of their net revenue from the restaurant business. The fund charges 99 bps in fees.
Shake Shack (SHAK - Free Report) – The Zacks Rank #2 (Buy) company is a New York-based fast food hamburger restaurant chain.
Electronics & Appliance Stores
Sales rose 1.9% year over year in February. On a sequential basis, sales rose 1.5% in February.
VanEck Semiconductor ETF (SMH - Free Report) – The underlying MVIS US Listed Semiconductor 25 Index tracks the overall performance of companies involved in semiconductor production and equipment. The fund charges 35 bps in fees.
NVIDIA (NVDA - Free Report) -- NVIDIA Corporation is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit, or GPU. Over the years, the company’s focus has evolved from PC graphics to artificial intelligence (AI) based solutions that now support high performance computing (HPC), gaming and virtual reality (VR) platforms. The stock has a Zacks Rank #1 (Strong Buy).
Miscellaneous Store Retailers
Sales rose 3.2% year over year in February. On a sequential basis, sales rose 0.6% in February.
SPDR S&P Retail ETF (XRT - Free Report) – The underlying S&P Retail Select Industry Index represents the retail sub-industry portion of the S&P TMI. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Small Cap exchanges. The Retail Index is a modified equal weight index. The fund charges 35 bps in fees.
The Kroger Co. (KR - Free Report) -- The Kroger Co., which operates in the thin-margin grocery industry, has been undergoing a complete makeover, not only with respect to products but also in terms of the way consumers prefer shopping grocery. The stock has a Zacks Rank #2.
Motor Vehicle & Parts Dealers
Sales rose 1.4% year over year in February. On a sequential basis, sales rose 1.6% in February.
First Trust S-Network Future Vehicles & Technology ETF (CARZ - Free Report) – The underlying S-Network Electric & Future Vehicle Ecosystem Index constituents are chosen by selecting the eligible Pure-Play companies in descending order of float-adjusted market capitalization until 100 constituents have been selected. The fund charges 70 bps in fees.
AutoZone (AZO - Free Report) -- AutoZone, Inc. is one of the leading specialty retailers and distributors of automotive replacement parts and accessories in the United States. The stock has a Zacks Rank #3 (Hold).
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4 ETF Areas to Play on Moderately Soft February Retail Sales
Americans increased their spending a bit in February after pulling back in January. But last month’s gain in retail sales was weaker-than-expected, and January’s decline was revised even lower, indicating that many are growing cautious with their spending ability. Retail sales rose 0.6% in February after falling a revised 1.1% in January, hurt partly by inclement weather, according to the Commerce Department’s report on Thursday.
Below we highlight a few areas and the related ETFs & stocks that may benefit handsomely from the retail sales.
Winning Areas
Food and Drink Places
Sales at restaurants and bars increased 6.3% year over year and 0.4% sequentially.
AdvisorShares Restaurant ETF (EATZ - Free Report) – The AdvisorShares Restaurant ETF is an actively managed exchange-traded fund that seeks to achieve its investment objective by investing at least 80% of its net assets in securities of companies that derive at least 50% of their net revenue from the restaurant business. The fund charges 99 bps in fees.
Shake Shack (SHAK - Free Report) – The Zacks Rank #2 (Buy) company is a New York-based fast food hamburger restaurant chain.
Electronics & Appliance Stores
Sales rose 1.9% year over year in February. On a sequential basis, sales rose 1.5% in February.
VanEck Semiconductor ETF (SMH - Free Report) – The underlying MVIS US Listed Semiconductor 25 Index tracks the overall performance of companies involved in semiconductor production and equipment. The fund charges 35 bps in fees.
NVIDIA (NVDA - Free Report) -- NVIDIA Corporation is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit, or GPU. Over the years, the company’s focus has evolved from PC graphics to artificial intelligence (AI) based solutions that now support high performance computing (HPC), gaming and virtual reality (VR) platforms. The stock has a Zacks Rank #1 (Strong Buy).
Miscellaneous Store Retailers
Sales rose 3.2% year over year in February. On a sequential basis, sales rose 0.6% in February.
SPDR S&P Retail ETF (XRT - Free Report) – The underlying S&P Retail Select Industry Index represents the retail sub-industry portion of the S&P TMI. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Small Cap exchanges. The Retail Index is a modified equal weight index. The fund charges 35 bps in fees.
The Kroger Co. (KR - Free Report) -- The Kroger Co., which operates in the thin-margin grocery industry, has been undergoing a complete makeover, not only with respect to products but also in terms of the way consumers prefer shopping grocery. The stock has a Zacks Rank #2.
Motor Vehicle & Parts Dealers
Sales rose 1.4% year over year in February. On a sequential basis, sales rose 1.6% in February.
First Trust S-Network Future Vehicles & Technology ETF (CARZ - Free Report) – The underlying S-Network Electric & Future Vehicle Ecosystem Index constituents are chosen by selecting the eligible Pure-Play companies in descending order of float-adjusted market capitalization until 100 constituents have been selected. The fund charges 70 bps in fees.
AutoZone (AZO - Free Report) -- AutoZone, Inc. is one of the leading specialty retailers and distributors of automotive replacement parts and accessories in the United States. The stock has a Zacks Rank #3 (Hold).