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5 Stocks to Buy Despite a Subdued Holiday Shopping Forecast This Year
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Key Takeaways
Holiday sales are projected to top $1 trillion, rising 3.7 to 4.2% year over year.
Amazon gains from AWS growth, AI tools like Rufus, and rising advertisement and store sales.
Walmart, Tapestry, Dollar General, and Expedia show earnings estimate upgrades.
U.S. holiday sales this season are likely to grow but at a muted rate. An uncertain macro-outlook primarily owing to President Donald Trump’s tariff and trade-related policies and their impacts, the ongoing shutdown of the U.S. government, which is currently the longest in history, hurdles faced by policy makers, investors and traders due to the unviability of key economic data and geopolitical disturbances significantly dented consumers' confidence.
The National Retail Federation (NRF) — the industry body of retailers — estimated that this year’s holiday sales during November and December will surpass the $1 trillion mark for the first time in history. This year’s sales are expected to grow 3.7-4.2% year over year. This will translate into sales of $1.01-$1.02 trillion. However, last year’s sales rose 4.3% year-over-year to $976.1 billion.
S&P Global Ratings expects holiday sales (November-December) to grow 4% in 2025 from 2024. Deloitte expects holiday shoppers to spend $1,595 on average in 2025, down a notable 10% year over year. A massive 77% of respondents surveyed by Deloitte expects 10% higher prices for holiday purchases in 2025.
Mastercard SpendingPulse has forecast total retail sales from Nov 1 to Dec 24, 2025 to increase 3.6% year over year. Within this, online retail sales are likely to advance 7.9% annually and brick-and-mortar sales are likely to increase 2.3% annually.
Adobe has estimated 2025 holiday sales from Nov. 1 through Dec. 31 to reach a record-high $253.4 billion, up 5.3% year over year (8.4% in 2024). More significantly, mobile transactions will account for more than 50% (53.2% in 2024) of total online sales, up 8.5% year over year (12.8% in 2024).
The chart below shows the price performance of our five picks in the past three months.
Image Source: Zacks Investment Research
Amazon.com Inc.
Global e-commerce giant Amazon has been benefiting from steady momentum in Prime and Amazon Web Services (AWS). In the third quarter of 2025, AWS contributed $33.01 billion, up 20.2% year over year. Despite facing massive competition from Alphabet Inc. (GOOGL) and Microsoft Corp. (MSFT), Amazon cloud service has performed impressively.
Moreover, online sales and subscription revenues increased 9.8% and 11.5%, respectively, year over year. Similarly, advertising revenue climbed 23.5%, year over year. Physical store sales increased 6.7% year over year.
Amazon is using the Claude chatbot of privately held Anthropic for AI exposure. The Trainium2 AI chip has become a lucrative opportunity for the company. Amazon is extensively using generative AI applications in its retail, cloud, devices and advertisement businesses.
In February 2025, AMZN introduced Rufus, a shopping chatbot that can answer and suggest products as per customers’ queries. Management said more than 250 million individuals have already used this product. The ecommerce behemoth has also unveiled Q, a chatbot for businesses, and Bedrock, a generative AI service for cloud customers.
Amazon has an expected revenue and earnings growth rate of 11.2% and 9.9%, respectively, for next year. The Zacks Consensus Estimate for next year’s earnings has improved 2.6% over the last 30 days.
Walmart Inc.
Walmart is benefiting from the inherent strength of its highly diversified business model. WMT’s strong omnichannel strategy has boosted traffic at physical stores and digital platforms. WMT’s focus on improving delivery services is successful, leading to steady grocery market share gains.
WMT has significantly bolstered its delivery capabilities, as exemplified by its Express On-Demand Early Morning Delivery service, Spark Driver platform, partnership with Salesforce, the expansion of the InHome delivery service, investments in DroneUp, the Walmart+ membership program and a pilot with Cruise to test grocery delivery through self-driven all-electric cars.
Walmart has an expected revenue and earnings growth rate of 4.4% each and 12.5%, respectively, for next year (ending January 2027). The Zacks Consensus Estimate for next year’s earnings has improved 0.7% over the last 60 days.
Tapestry Inc.
Tapestry continued to build momentum in fiscal 2025, with Coach driving growth through strong engagement from Gen Z and millennial consumers. TPR delivered meaningful expansion across North America, Europe and Greater China, fueled by product innovation, brand heat and investments in digital. TPR’s direct-to-consumer model and record gross margin underscored pricing power and operational strength.
TPR’s international business gained substantial traction in the fourth quarter. Europe grew 10% year over year at constant currency, fueled by increased local consumer spending and strong Gen Z acquisition. In Greater China, revenues surged 18%, significantly ahead of expectations, with broad-based growth across channels, especially digital.
Tapestry has an expected revenue and earnings growth rate of 3.4% each and 9.5%, respectively, for the current year (ending June 2026). The Zacks Consensus Estimate for current year’s earnings has improved 1.6% over the last seven days.
Dollar General Corp.
Dollar General remains a compelling growth story, underpinned by disciplined cost management, strategic investments, and a customer-centric model. DG’s emphasis on value pricing, supply-chain optimization, and enhanced labor productivity is driving steady store traffic. Its omnichannel expansion, strengthened through partnerships with DoorDash and Uber Eats, extends market reach while supporting higher basket sizes.
Meanwhile, the DG Media Network is emerging as a high-margin growth engine. DG’s initiatives such as Project Elevate and Project Renovate are improving store productivity. With a resilient core consumer base, expanding real estate, and a digital ecosystem, DG appears well-positioned to deliver sustained sales growth.
Dollar General has an expected revenue and earnings growth rate of 4.2% each and 8.4%, respectively, for next year (ending January 2027). The Zacks Consensus Estimate for next year’s earnings has improved 0.8% over the last 60 days.
Expedia Group Inc.
Expedia Group benefits from a strong platform model that enhances customer insights, strengthens supplier ties, and helps in revenue growth. EXPE’s diverse brand portfolio spanning major travel services enables it to target a broad range of global traveler needs, while boosting traffic and bookings.
A broad multi-product supply network, including lodging, airlines, rental cars, and cruises, positions EXPE well to capture demand in the growing leisure travel space. Strong liquidity, share buybacks, and dividends further highlight EXPE’s financial resilience.
Expedia Group has an expected revenue and earnings growth rate of 2% and 17.8%, respectively, for next year. The Zacks Consensus Estimate for next year’s earnings has improved 1.2% over the last 30 days.
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5 Stocks to Buy Despite a Subdued Holiday Shopping Forecast This Year
Key Takeaways
U.S. holiday sales this season are likely to grow but at a muted rate. An uncertain macro-outlook primarily owing to President Donald Trump’s tariff and trade-related policies and their impacts, the ongoing shutdown of the U.S. government, which is currently the longest in history, hurdles faced by policy makers, investors and traders due to the unviability of key economic data and geopolitical disturbances significantly dented consumers' confidence.
Despite the lukewarm view, we recommend five retailers (offline or online), with a favorable Zacks Rank, for investing in the holiday season. These are: Amazon.com Inc. (AMZN - Free Report) , Walmart Inc. (WMT - Free Report) , Tapestry Inc. (TPR - Free Report) , Dollar General Corp. (DG - Free Report) and Expedia Group Inc. (EXPE - Free Report) . Each of our picks currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Muted Holiday Sales Estimations
The National Retail Federation (NRF) — the industry body of retailers — estimated that this year’s holiday sales during November and December will surpass the $1 trillion mark for the first time in history. This year’s sales are expected to grow 3.7-4.2% year over year. This will translate into sales of $1.01-$1.02 trillion. However, last year’s sales rose 4.3% year-over-year to $976.1 billion.
S&P Global Ratings expects holiday sales (November-December) to grow 4% in 2025 from 2024. Deloitte expects holiday shoppers to spend $1,595 on average in 2025, down a notable 10% year over year. A massive 77% of respondents surveyed by Deloitte expects 10% higher prices for holiday purchases in 2025.
Mastercard SpendingPulse has forecast total retail sales from Nov 1 to Dec 24, 2025 to increase 3.6% year over year. Within this, online retail sales are likely to advance 7.9% annually and brick-and-mortar sales are likely to increase 2.3% annually.
Adobe has estimated 2025 holiday sales from Nov. 1 through Dec. 31 to reach a record-high $253.4 billion, up 5.3% year over year (8.4% in 2024). More significantly, mobile transactions will account for more than 50% (53.2% in 2024) of total online sales, up 8.5% year over year (12.8% in 2024).
The chart below shows the price performance of our five picks in the past three months.
Image Source: Zacks Investment Research
Amazon.com Inc.
Global e-commerce giant Amazon has been benefiting from steady momentum in Prime and Amazon Web Services (AWS). In the third quarter of 2025, AWS contributed $33.01 billion, up 20.2% year over year. Despite facing massive competition from Alphabet Inc. (GOOGL) and Microsoft Corp. (MSFT), Amazon cloud service has performed impressively.
Moreover, online sales and subscription revenues increased 9.8% and 11.5%, respectively, year over year. Similarly, advertising revenue climbed 23.5%, year over year. Physical store sales increased 6.7% year over year.
Amazon is using the Claude chatbot of privately held Anthropic for AI exposure. The Trainium2 AI chip has become a lucrative opportunity for the company. Amazon is extensively using generative AI applications in its retail, cloud, devices and advertisement businesses.
In February 2025, AMZN introduced Rufus, a shopping chatbot that can answer and suggest products as per customers’ queries. Management said more than 250 million individuals have already used this product. The ecommerce behemoth has also unveiled Q, a chatbot for businesses, and Bedrock, a generative AI service for cloud customers.
Amazon has an expected revenue and earnings growth rate of 11.2% and 9.9%, respectively, for next year. The Zacks Consensus Estimate for next year’s earnings has improved 2.6% over the last 30 days.
Walmart Inc.
Walmart is benefiting from the inherent strength of its highly diversified business model. WMT’s strong omnichannel strategy has boosted traffic at physical stores and digital platforms. WMT’s focus on improving delivery services is successful, leading to steady grocery market share gains.
WMT has significantly bolstered its delivery capabilities, as exemplified by its Express On-Demand Early Morning Delivery service, Spark Driver platform, partnership with Salesforce, the expansion of the InHome delivery service, investments in DroneUp, the Walmart+ membership program and a pilot with Cruise to test grocery delivery through self-driven all-electric cars.
Walmart has an expected revenue and earnings growth rate of 4.4% each and 12.5%, respectively, for next year (ending January 2027). The Zacks Consensus Estimate for next year’s earnings has improved 0.7% over the last 60 days.
Tapestry Inc.
Tapestry continued to build momentum in fiscal 2025, with Coach driving growth through strong engagement from Gen Z and millennial consumers. TPR delivered meaningful expansion across North America, Europe and Greater China, fueled by product innovation, brand heat and investments in digital. TPR’s direct-to-consumer model and record gross margin underscored pricing power and operational strength.
TPR’s international business gained substantial traction in the fourth quarter. Europe grew 10% year over year at constant currency, fueled by increased local consumer spending and strong Gen Z acquisition. In Greater China, revenues surged 18%, significantly ahead of expectations, with broad-based growth across channels, especially digital.
Tapestry has an expected revenue and earnings growth rate of 3.4% each and 9.5%, respectively, for the current year (ending June 2026). The Zacks Consensus Estimate for current year’s earnings has improved 1.6% over the last seven days.
Dollar General Corp.
Dollar General remains a compelling growth story, underpinned by disciplined cost management, strategic investments, and a customer-centric model. DG’s emphasis on value pricing, supply-chain optimization, and enhanced labor productivity is driving steady store traffic. Its omnichannel expansion, strengthened through partnerships with DoorDash and Uber Eats, extends market reach while supporting higher basket sizes.
Meanwhile, the DG Media Network is emerging as a high-margin growth engine. DG’s initiatives such as Project Elevate and Project Renovate are improving store productivity. With a resilient core consumer base, expanding real estate, and a digital ecosystem, DG appears well-positioned to deliver sustained sales growth.
Dollar General has an expected revenue and earnings growth rate of 4.2% each and 8.4%, respectively, for next year (ending January 2027). The Zacks Consensus Estimate for next year’s earnings has improved 0.8% over the last 60 days.
Expedia Group Inc.
Expedia Group benefits from a strong platform model that enhances customer insights, strengthens supplier ties, and helps in revenue growth. EXPE’s diverse brand portfolio spanning major travel services enables it to target a broad range of global traveler needs, while boosting traffic and bookings.
A broad multi-product supply network, including lodging, airlines, rental cars, and cruises, positions EXPE well to capture demand in the growing leisure travel space. Strong liquidity, share buybacks, and dividends further highlight EXPE’s financial resilience.
Expedia Group has an expected revenue and earnings growth rate of 2% and 17.8%, respectively, for next year. The Zacks Consensus Estimate for next year’s earnings has improved 1.2% over the last 30 days.