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4 Retail Stocks to Buy as the Sector Resumes its Climb in 2024
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Retail Sales picked up in February despite consumer prices being on the rise again, demonstrating a positive consumer mood about steady interest rates and more available cash to spend.
Per the Commerce Department, retail sales for February rose 0.6% to $700.7 billion from the previous month. The January number was revised up to a 1.1% fall from the previously reported 0.8%. However, rising prices affected retail sales, which, despite improving from January, fell short of expectations in February. The consensus estimate for the period was 1%.
The retail sales numbers for February were primarily boosted by higher gasoline prices and higher auto sales. A strong jobs market and rising wages also fueled sales.
Usually, inflation and purchasing power have a decisive impact on retail sales. In an environment where prices of consumer goods steadily go up, and interest rates are raised to tackle it, people end up having less money at their disposal to spend on non-essential goods. However, while consumer prices increased in February, they were in line with expectations and, hence, seemingly did not affect retail sales.
The Fed also assured from their March meeting that they were still looking to cut interest rates thrice in 2024, even as they stopped short of confirming the first cut to be in June. Apparently, consumers are buying into the Fed’s outlook and are expecting more money at their disposal for the year. Also, with the jobs market remaining resilient, consumer spending should get a boost with less to fear about an uncertain future.
We have thus selected four stocks that we believe would be gaining ground in the ensuing months and should be looked into now. The stocks below flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy). The search was also narrowed down with a VGM Score of A or B. Here V stands for Value, G for Growth and M for Momentum; the score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners.
Abercrombie & Fitch Co. (ANF - Free Report) is a global multi-specialty retailer.
ANF’s expected earnings growth rate for the current year is 19.1%. The Zacks Consensus Estimate for its current-year earnings has improved 18.9% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
American Eagle Outfitters, Inc. (AEO - Free Report) is a specialty retailer that engages in the business of selling clothing, accessories and personal care products.
AEO’s expected earnings growth rate for the current year is 12.5%. The Zacks Consensus Estimate for its current-year earnings has improved 11.8% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of A.
TSCDY’s expected earnings growth rate for the current year is 21.5%. The Zacks Consensus Estimate for its current-year earnings has improved 12.9% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of A.
Deckers Outdoor Corporation (DECK - Free Report) is a retail chain for outdoor footwear, apparel and accessories.
DECK’s expected earnings growth rate for the current year is 38.7%. The Zacks Consensus Estimate for its current-year earnings has improved 12.5% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of B.
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4 Retail Stocks to Buy as the Sector Resumes its Climb in 2024
Retail Sales picked up in February despite consumer prices being on the rise again, demonstrating a positive consumer mood about steady interest rates and more available cash to spend.
Per the Commerce Department, retail sales for February rose 0.6% to $700.7 billion from the previous month. The January number was revised up to a 1.1% fall from the previously reported 0.8%. However, rising prices affected retail sales, which, despite improving from January, fell short of expectations in February. The consensus estimate for the period was 1%.
The retail sales numbers for February were primarily boosted by higher gasoline prices and higher auto sales. A strong jobs market and rising wages also fueled sales.
Usually, inflation and purchasing power have a decisive impact on retail sales. In an environment where prices of consumer goods steadily go up, and interest rates are raised to tackle it, people end up having less money at their disposal to spend on non-essential goods. However, while consumer prices increased in February, they were in line with expectations and, hence, seemingly did not affect retail sales.
The Fed also assured from their March meeting that they were still looking to cut interest rates thrice in 2024, even as they stopped short of confirming the first cut to be in June. Apparently, consumers are buying into the Fed’s outlook and are expecting more money at their disposal for the year. Also, with the jobs market remaining resilient, consumer spending should get a boost with less to fear about an uncertain future.
We have thus selected four stocks that we believe would be gaining ground in the ensuing months and should be looked into now. The stocks below flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy). The search was also narrowed down with a VGM Score of A or B. Here V stands for Value, G for Growth and M for Momentum; the score is a weighted combination of these three metrics. Such a score allows you to eliminate the negative aspects of stocks and select winners.
Abercrombie & Fitch Co. (ANF - Free Report) is a global multi-specialty retailer.
ANF’s expected earnings growth rate for the current year is 19.1%. The Zacks Consensus Estimate for its current-year earnings has improved 18.9% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of A. You can see the complete list of today’s Zacks #1 Rank stocks here.
American Eagle Outfitters, Inc. (AEO - Free Report) is a specialty retailer that engages in the business of selling clothing, accessories and personal care products.
AEO’s expected earnings growth rate for the current year is 12.5%. The Zacks Consensus Estimate for its current-year earnings has improved 11.8% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of A.
Tesco PLC (TSCDY - Free Report) is a global grocery retailer.
TSCDY’s expected earnings growth rate for the current year is 21.5%. The Zacks Consensus Estimate for its current-year earnings has improved 12.9% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of A.
Deckers Outdoor Corporation (DECK - Free Report) is a retail chain for outdoor footwear, apparel and accessories.
DECK’s expected earnings growth rate for the current year is 38.7%. The Zacks Consensus Estimate for its current-year earnings has improved 12.5% over the past 60 days. The company has a Zacks Rank #1 and a VGM Score of B.