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With back-to-school season entering its peak month, retailers are on their toes with initiatives to perk up sales. The second-busiest shopping spell from mid July to mid September after Christmas holidays, sees sales picking up in mid August on heavy promotional offers such as cash back, coupon discounts and free shipping.
This year, back-to-college spending is expected to be at its highest level ever while back-to-school spending is expected to see one of the three highest years on record. As per the National Retail Federation (NRF), combined spending on back to school and college is expected to reach $82.8 billion, slightly down from $83.6 billion last year. A thriving economy buoyed by tax reform and growing consumer confidence has been the biggest catalyst.
Families with children in elementary through high school is expected to spend $684.79 per child on clothing, electronics such as computers, calculators or phones, shoes, and other school supplies such as notebooks, pencils, backpacks and lunchboxes, for a total of $27.5 billion. This is the third-highest spending following a peak of $30.3 billion in 2012 and last year’s $29.5 billion.
The top shopping destinations for back-to-school shoppers are department stores (57%), online retailers (55%), discount stores (52%) and clothing stores (51%).
Per eMarketer, overall back-to-school season sales are expected to reach $885.2 billion, rising 3.5% this year versus 3.7% last year. Of this, ecommerce will likely account for nearly 10% of sales this year, reflecting an increase of 15.4%, up from the last year’s gain of 15%.
Given the splurge in spending, companies selling back-to-school products will see a boost in sales and a resultant surge in their stock prices. So, betting on these stocks should be a winning strategy for investors seeking to hog profits from the back-to-school season. Below we have highlighted some interesting picks that are also supported by a Zacks Rank #1 (Strong Buy) or #2 (Buy).
This departmental store is offering back-to-school clothing as low as $15 and up to 20% off on backpacks using the code "BTS." The stock saw positive earnings estimate revision of 19 cents over the past 30 days for the year (ending January 2019) with an expected earnings growth rate of 6.63%. It has a Zacks Rank #2 and a Momentum Score of A.
The online e-commerce behemoth is offering up to 60% off on school supplies and Lexmark printer, and up to 40% on select backpacks. It is also luring customers to save $100 or more on Acer laptops. The stock saw robust earnings estimate revision of $4.87 over the past 30 days for this year and has an estimated earnings growth rate of a whopping 279.56%. Amazon sports a Zacks Rank #1 and has a Momentum Score of B. You can see the complete list of today’s Zacks #1 Rank stocks here.
This general merchandise retailer is promoting deals on clothes, backpacks and school supplies, with a big selection of products from the new brands the big-box retailer rolled out in recent months, like kids’ Cat & Jack T-shirts with fun graphic prints for just $5, a discount of 17%, Cat & Jack backpacks starting at just $15. It is also offering up to 25% on dorm furniture and 25% off on the purchase of another pilot pen. Target saw positive earnings estimate revision of a couple of cents over the past 30 days for the year (ending January 2019) with an expected earnings growth rate of 12.53%. It has a Zacks Rank #2 and Momentum Score of A.
This departmental store is offering free shipping on orders of $75 or more and has some great deals like 25% off on gym gear from Under Armour, or the slip-on boys’ Vans skater sneakers in the brand’s iconic checkered pattern in black or red and white, for just $33.99 (down from $44.99). The stock saw positive earnings estimate revision of couple of cents over the past 30 days for the year (ending January 2019) with an expected earnings growth rate of 28.88%. It has a Zacks Rank #2 and Growth Score of A.
This leading retailer of technology products, services and solutions is offering a series of student-exclusive deals including $50 off on select Chromebooks and select iPad models, $30 off on Microsoft Office packages, $150 off on select Macbooks, and 10% off on Google Pixelbooks. Though Best Buy has not seen any earnings estimate revision activity over the past 30 days, its earnings are expected to grow 13.35% for the year (ending January 2019). The stock carries a Zacks Rank #2 and has a Value Score of B.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
5 Best Back-to-School Stock Deals
With back-to-school season entering its peak month, retailers are on their toes with initiatives to perk up sales. The second-busiest shopping spell from mid July to mid September after Christmas holidays, sees sales picking up in mid August on heavy promotional offers such as cash back, coupon discounts and free shipping.
This year, back-to-college spending is expected to be at its highest level ever while back-to-school spending is expected to see one of the three highest years on record. As per the National Retail Federation (NRF), combined spending on back to school and college is expected to reach $82.8 billion, slightly down from $83.6 billion last year. A thriving economy buoyed by tax reform and growing consumer confidence has been the biggest catalyst.
Families with children in elementary through high school is expected to spend $684.79 per child on clothing, electronics such as computers, calculators or phones, shoes, and other school supplies such as notebooks, pencils, backpacks and lunchboxes, for a total of $27.5 billion. This is the third-highest spending following a peak of $30.3 billion in 2012 and last year’s $29.5 billion.
The top shopping destinations for back-to-school shoppers are department stores (57%), online retailers (55%), discount stores (52%) and clothing stores (51%).
Per eMarketer, overall back-to-school season sales are expected to reach $885.2 billion, rising 3.5% this year versus 3.7% last year. Of this, ecommerce will likely account for nearly 10% of sales this year, reflecting an increase of 15.4%, up from the last year’s gain of 15%.
Given the splurge in spending, companies selling back-to-school products will see a boost in sales and a resultant surge in their stock prices. So, betting on these stocks should be a winning strategy for investors seeking to hog profits from the back-to-school season. Below we have highlighted some interesting picks that are also supported by a Zacks Rank #1 (Strong Buy) or #2 (Buy).
Macy's Inc. (M - Free Report)
This departmental store is offering back-to-school clothing as low as $15 and up to 20% off on backpacks using the code "BTS." The stock saw positive earnings estimate revision of 19 cents over the past 30 days for the year (ending January 2019) with an expected earnings growth rate of 6.63%. It has a Zacks Rank #2 and a Momentum Score of A.
Amazon.com Inc. (AMZN - Free Report)
The online e-commerce behemoth is offering up to 60% off on school supplies and Lexmark printer, and up to 40% on select backpacks. It is also luring customers to save $100 or more on Acer laptops. The stock saw robust earnings estimate revision of $4.87 over the past 30 days for this year and has an estimated earnings growth rate of a whopping 279.56%. Amazon sports a Zacks Rank #1 and has a Momentum Score of B. You can see the complete list of today’s Zacks #1 Rank stocks here.
Target Corporation (TGT - Free Report)
This general merchandise retailer is promoting deals on clothes, backpacks and school supplies, with a big selection of products from the new brands the big-box retailer rolled out in recent months, like kids’ Cat & Jack T-shirts with fun graphic prints for just $5, a discount of 17%, Cat & Jack backpacks starting at just $15. It is also offering up to 25% on dorm furniture and 25% off on the purchase of another pilot pen. Target saw positive earnings estimate revision of a couple of cents over the past 30 days for the year (ending January 2019) with an expected earnings growth rate of 12.53%. It has a Zacks Rank #2 and Momentum Score of A.
Kohl's Corporation (KSS - Free Report)
This departmental store is offering free shipping on orders of $75 or more and has some great deals like 25% off on gym gear from Under Armour, or the slip-on boys’ Vans skater sneakers in the brand’s iconic checkered pattern in black or red and white, for just $33.99 (down from $44.99). The stock saw positive earnings estimate revision of couple of cents over the past 30 days for the year (ending January 2019) with an expected earnings growth rate of 28.88%. It has a Zacks Rank #2 and Growth Score of A.
Best Buy Co. Inc. (BBY - Free Report)
This leading retailer of technology products, services and solutions is offering a series of student-exclusive deals including $50 off on select Chromebooks and select iPad models, $30 off on Microsoft Office packages, $150 off on select Macbooks, and 10% off on Google Pixelbooks. Though Best Buy has not seen any earnings estimate revision activity over the past 30 days, its earnings are expected to grow 13.35% for the year (ending January 2019). The stock carries a Zacks Rank #2 and has a Value Score of B.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>