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The Zacks Analyst Blog Highlights American Eagle Outfitters, Amazon.com, Deckers Outdoor, Walmart and Tripadvisor
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For Immediate Release
Chicago, IL – November 17, 2023 – 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: American Eagle Outfitters, Inc. (AEO - Free Report) , Amazon.com, Inc. (AMZN - Free Report) , Deckers Outdoor Corp. (DECK - Free Report) , Walmart, Inc. (WMT - Free Report) and Tripadvisor, Inc. (TRIP - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
5 Solid Retail Stocks to Buy Ahead of Holiday Season
The retail sector is trying to stage a solid recovery amid existing inflationary pressures. However, retail sales declined marginally in October, the first time in seven months. Even then, the retail sector has immense potential, and with inflation declining steadily and the holiday season approaching, the sector is poised to do well.
Given this situation, stocks like American Eagle Outfitters, Inc., Amazon.com, Inc., Deckers Outdoor Corp., Walmart, Inc. and Tripadvisor, Inc. are expected to benefit in the near term.
Retail Sector Fighting Back
The Commerce Department said on Nov 15 that retail sales declined marginally by 0.1% in October. However, the reading came in a lot better than economists’ forecast of a decline of 0.3%.
October’s decline follows a 0.9% jump in retail sales in September. Moreover, retail sales have declined for the first time since March.
Higher demand fueled by robust spending had been driving retail sales. However, personal spending slowed in October, which hampered retail sales.
Despite the decline, consumers spent aggressively at restaurants and supermarkets, with sales rising 0.3% and 0.7% in October, respectively.
Retailers are now looking forward to the upcoming holiday season, which is one of the year’s most important shopping windows. Although sales declined marginally in October, holiday sales are projected to grow this year, too.
According to the National Retail Federation, holiday sales are projected to jump 3-4% to $957.3-$966.6 billion this year.
The NRF projects that sales from online and other non-store channels will increase by 7% to 9%, totaling $273.7 billion to $278.8 billion.
U.S. third-quarter GDP rose a solid 4.9%, more than double the increase in the second quarter, reflecting the underlying strength in the economy.
Inflation, too, has been declining sharply. The Consumer Price Index (CPI) rose 3.2% year over year in October, declining from September’s rise of 3.7%. Core CPI, which excludes energy and food prices, increased 4% year over year in October. Month over month, Core CPI increased 0.4%.
Also, the Fed kept interest rates unchanged in its last two FOMC meetings to the current range of 5.25-5.5%. This has raised expectations that the Fed might soon end its monetary tightening cycle. This bodes well for the retail sector.
Our Choices
Given this scenario, retail stocks are expected to benefit in the near term. We've identified five retail stocks that exhibit a Zacks Rank of #1 (Strong Buy) or 2 (Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.
American Eagle Outfitters, Inc. is a specialty retailer of casual apparel, accessories and footwear for men and women aged 15-25 years. AEO, along with its subsidiaries, engages in the designing and marketing of casual clothing. American Eagle Outfitters’ assortment includes jeans, cargo pants, graphic T-shirts, and a range of accessories, outerwear and footwear.
American Eagle Outfitters’ expected earnings growth rate for the current year is 36.1%. The Zacks Consensus Estimate for current-year earnings has improved 4.8% over the past 60 days. AEO presently sports a Zacks Rank #1.
Amazon.com, Inc. is one of the largest e-commerce providers, with sprawling operations in North America and across the globe. AMZN’s online retail business revolves around the Prime program, well supported by the company’s massive distribution network. Further, the Whole Foods Market acquisition helped Amazon establish its footprint in the physical grocery supermarket space.
Amazon.com’s expected earnings growth rate for the current year is 276.1%. The Zacks Consensus Estimate for current-year earnings has improved 19.7% over the past 60 days. AMZN presently carries a Zacks Rank #2.
Deckers Outdoor Corp. is a leading designer, producer and brand manager of innovative, niche footwear and accessories developed for outdoor sports and other lifestyle-related activities. DECK sells products primarily under five proprietary brands — UGG, HOKA, Teva, Sanuk and Other brands (mainly comprising Koolaburra).
Deckers Outdoor’s expected earnings growth rate for the current year is 20.8%. The Zacks Consensus Estimate for current-year earnings has improved 4.5% over the past 60 days. DECK currently has a Zacks Rank #2.
Walmart has evolved from just being a traditional brick-and-mortar retailer into an omnichannel player. WMT’s product offerings include almost everything from grocery to cosmetics, electronics to stationery, home furnishings to health and wellness products, and apparel to entertainment products, to name a few.
Walmart’s expected earnings growth rate for the current year is 2.7%. The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the past 60 days. WMT presently carries a Zacks Rank #2.
Tripadvisor, Inc. is one of the largest online travel research companies in the world. It provides a platform for users to share reviews, ratings and opinions on hotels, destinations, attractions and restaurants. TRIP also facilitates bookings between hotel suppliers and consumers using its web portals.
Tripadvisor’s expected earnings growth rate for the current year is 48%. The Zacks Consensus Estimate for current-year earnings has improved 5.7% over the past 60 days. TRIP currently has a Zacks Rank #2.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
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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The Zacks Analyst Blog Highlights American Eagle Outfitters, Amazon.com, Deckers Outdoor, Walmart and Tripadvisor
For Immediate Release
Chicago, IL – November 17, 2023 – 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: American Eagle Outfitters, Inc. (AEO - Free Report) , Amazon.com, Inc. (AMZN - Free Report) , Deckers Outdoor Corp. (DECK - Free Report) , Walmart, Inc. (WMT - Free Report) and Tripadvisor, Inc. (TRIP - Free Report) .
Here are highlights from Thursday’s Analyst Blog:
5 Solid Retail Stocks to Buy Ahead of Holiday Season
The retail sector is trying to stage a solid recovery amid existing inflationary pressures. However, retail sales declined marginally in October, the first time in seven months. Even then, the retail sector has immense potential, and with inflation declining steadily and the holiday season approaching, the sector is poised to do well.
Given this situation, stocks like American Eagle Outfitters, Inc., Amazon.com, Inc., Deckers Outdoor Corp., Walmart, Inc. and Tripadvisor, Inc. are expected to benefit in the near term.
Retail Sector Fighting Back
The Commerce Department said on Nov 15 that retail sales declined marginally by 0.1% in October. However, the reading came in a lot better than economists’ forecast of a decline of 0.3%.
October’s decline follows a 0.9% jump in retail sales in September. Moreover, retail sales have declined for the first time since March.
Higher demand fueled by robust spending had been driving retail sales. However, personal spending slowed in October, which hampered retail sales.
Despite the decline, consumers spent aggressively at restaurants and supermarkets, with sales rising 0.3% and 0.7% in October, respectively.
Retailers are now looking forward to the upcoming holiday season, which is one of the year’s most important shopping windows. Although sales declined marginally in October, holiday sales are projected to grow this year, too.
According to the National Retail Federation, holiday sales are projected to jump 3-4% to $957.3-$966.6 billion this year.
The NRF projects that sales from online and other non-store channels will increase by 7% to 9%, totaling $273.7 billion to $278.8 billion.
U.S. third-quarter GDP rose a solid 4.9%, more than double the increase in the second quarter, reflecting the underlying strength in the economy.
Inflation, too, has been declining sharply. The Consumer Price Index (CPI) rose 3.2% year over year in October, declining from September’s rise of 3.7%. Core CPI, which excludes energy and food prices, increased 4% year over year in October. Month over month, Core CPI increased 0.4%.
Also, the Fed kept interest rates unchanged in its last two FOMC meetings to the current range of 5.25-5.5%. This has raised expectations that the Fed might soon end its monetary tightening cycle. This bodes well for the retail sector.
Our Choices
Given this scenario, retail stocks are expected to benefit in the near term. We've identified five retail stocks that exhibit a Zacks Rank of #1 (Strong Buy) or 2 (Buy).You can see the complete list of today’s Zacks #1 Rank stocks here.
American Eagle Outfitters, Inc. is a specialty retailer of casual apparel, accessories and footwear for men and women aged 15-25 years. AEO, along with its subsidiaries, engages in the designing and marketing of casual clothing. American Eagle Outfitters’ assortment includes jeans, cargo pants, graphic T-shirts, and a range of accessories, outerwear and footwear.
American Eagle Outfitters’ expected earnings growth rate for the current year is 36.1%. The Zacks Consensus Estimate for current-year earnings has improved 4.8% over the past 60 days. AEO presently sports a Zacks Rank #1.
Amazon.com, Inc. is one of the largest e-commerce providers, with sprawling operations in North America and across the globe. AMZN’s online retail business revolves around the Prime program, well supported by the company’s massive distribution network. Further, the Whole Foods Market acquisition helped Amazon establish its footprint in the physical grocery supermarket space.
Amazon.com’s expected earnings growth rate for the current year is 276.1%. The Zacks Consensus Estimate for current-year earnings has improved 19.7% over the past 60 days. AMZN presently carries a Zacks Rank #2.
Deckers Outdoor Corp. is a leading designer, producer and brand manager of innovative, niche footwear and accessories developed for outdoor sports and other lifestyle-related activities. DECK sells products primarily under five proprietary brands — UGG, HOKA, Teva, Sanuk and Other brands (mainly comprising Koolaburra).
Deckers Outdoor’s expected earnings growth rate for the current year is 20.8%. The Zacks Consensus Estimate for current-year earnings has improved 4.5% over the past 60 days. DECK currently has a Zacks Rank #2.
Walmart has evolved from just being a traditional brick-and-mortar retailer into an omnichannel player. WMT’s product offerings include almost everything from grocery to cosmetics, electronics to stationery, home furnishings to health and wellness products, and apparel to entertainment products, to name a few.
Walmart’s expected earnings growth rate for the current year is 2.7%. The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the past 60 days. WMT presently carries a Zacks Rank #2.
Tripadvisor, Inc. is one of the largest online travel research companies in the world. It provides a platform for users to share reviews, ratings and opinions on hotels, destinations, attractions and restaurants. TRIP also facilitates bookings between hotel suppliers and consumers using its web portals.
Tripadvisor’s expected earnings growth rate for the current year is 48%. The Zacks Consensus Estimate for current-year earnings has improved 5.7% over the past 60 days. TRIP currently has a Zacks Rank #2.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +6.2 average gain per year. Amazingly, they soared with average gains of +46.4%, +49.5% and +55.2% per year. Today you can access their live picks without cost or obligation.
See Stocks Free >>
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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.