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The Zacks Analyst Blog Highlights: Columbia Sportswear, Marcus, Deckers Outdoor, Monro and Rocky Brands

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For Immediate Release

Chicago, IL – November 1, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Columbia Sportswear Co. (COLM - Free Report) , The Marcus Corp. (MCS - Free Report) , Deckers Outdoor Corp. (DECK - Free Report) , Monro, Inc. (MNRO - Free Report) and Rocky Brands, Inc. (RCKY - Free Report) .

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Here are highlights from Wednesday’s Analyst Blog:

Consumer Confidence Leaps to 18-Year Highs: 5 Big Gainers

Consumers in America are currently most confident in almost two decades, courtesy of a healthy labor market and strong economic outlook. Their assessment of present-day conditions is positive, making them confident of continued economic expansion, at least in the near term.

More the confident consumers are about their well-being, the more will they spend. Thus, things are currently looking up for consumer discretionary companies that are poised to gain on signs of renewed strength in consumer spending.

Consumers in High Spirits

U.S. consumer confidence soared to its highest in 18 years in October, per the Conference Board, a business research organization. The consumer confidence index climbed to 137.9 from 135.3 in September. Economists had expected the consumer index to slip to 134.9 in the month.

Nonetheless, the key economic indicator that measures attitudes on future economic prospects registered its best reading since the fall of 2000 and is not too far from the all-time high of 144.7 reached that year.

People’s confidence in the present situations improved from 169.4 last month to 172.8 this month, matching the highest level reached in December 2000. The future expectations index also moved from 112.5 to 114.6, an 18-year high.

What Drove Confidence?

Household optimism was largely driven by robust labor market, suggesting strong economic expansion in the near future. Lynn Franco, senior director of economic indicators at the Conference Board, said that American’s assessment of present condition has improved, mostly because of solid employment growth. She added that “the expectations index posted another gain in October, suggesting that consumers do not foresee the economy losing steam anytime soon, rather, they expect the strong pace of growth to carry over into early 2019.”

The U.S. unemployment rate is currently at a 49-year low of 3.7%, the lowest since December 1969. Meanwhile, the country’s total output of goods and services expanded at an annualized pace of 3.5% in the third quarter. In fact, the economy in the last two quarters recorded the fastest six-month growth in four years and is on track to hit Trump administration’s annual growth target of 3%. If that happens, it would be the best yearly performance since 2005, two years before the Great Recession.

Why Does Consumer Confidence Matter?

Such a record consumer confidence number is a significant reading since it has been, historically, good at predicting consumer spending for the next three to six months. More the confidence households generate, the more will they spend. Notably, consumer spending accounts for roughly 70% of the U.S. economy, which isn’t a petty number.

These numbers influence companies’ production schedule, particularly consumer discretionary items. In fact, consumer discretionary items including durable goods, apparel, entertainment and leisure, and automobiles are mostly affected as spending plays a major role in determining revenues.

5 Stocks to Gain From Confident Consumers

Since the aforesaid areas are positioned to benefit from this stellar reading on confidence level, picking stocks from the same will be a smart move. We have, thus, selected five consumer discretionary stocks that flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy).

The stocks also boast a VGM Score of A or B. Here V stands for Value, G for Growth and M for Momentum and 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.

Columbia Sportswear Co. designs, markets, and distributes outdoor and active lifestyle apparel, footwear and accessories. The stock has a Zacks Rank #1 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has increased 3.2% in the last 60 days. The company’s expected earnings growth rate for the current year is 20.2% compared with the Textile - Apparel industry’s projected rise of 18%.

The Marcus Corp. owns and operates movie theatres, and hotels and resorts. The stock has a Zacks Rank #1 and a VGM Score of A. The Zacks Consensus Estimate for its current-year earnings has increased 6.8% in the last 60 days. The company’s expected earnings growth rate for the current year is 22.1% compared with the Leisure and Recreation Services industry’s estimated rise of 5%.

Deckers Outdoor Corp. designs, markets, and distributes footwear, apparel, and accessories for casual lifestyle use. The stock has a Zacks Rank #1 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has increased almost 5% in the last 60 days. The company’s expected earnings growth rate for the current year is 17.6% compared with the Shoes and Retail Apparel  industry’s projected rise of 17.1%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Monro, Inc. provides automotive undercar repair, and tire sales and services. The stock has a Zacks Rank #2 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has increased 0.9% in the last 60 days. The company’s expected earnings growth rate for the current year is 13.9% compared with the Consumer Services - Miscellaneous industry’s projected rise of 8.6%.

Rocky Brands, Inc. designs, manufactures, and markets footwear and apparel. The stock has a Zacks Rank #1 and a VGM Score of B. The Zacks Consensus Estimate for its current-year earnings has increased 7.6% in the last 60 days. The company’s expected earnings growth rate for the current year is 57.8% compared with the Shoes and Retail Apparel  industry’s estimated rise of 17.1%.

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Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.



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