Consumer spending remained strong in March, defying expectations as retail sales rose 1.4% month over month to $734.9 billion, according to the Commerce Department's latest report. The rise in sales follows a modest 0.2% increase in February. This uptick came despite waning consumer sentiment amid fears of escalating trade tensions and a potential economic slowdown.

Market experts pointed out that the surge in retail sales was driven by heightened purchases across various sectors, including motor vehicles and other consumer goods. This spike suggests that consumers rushed to make purchases ahead of potential price hikes due to impending tariffs, contributing to the month's impressive figures. 

Retailers such as Sprouts Farmers Market, Inc. (SFM Quick QuoteSFM - Free Report) , BJ's Wholesale Club Holdings, Inc. (BJ Quick QuoteBJ - Free Report) , BJ's Restaurants, Inc. (BJRI Quick QuoteBJRI - Free Report) and The Kroger Co. (KR Quick QuoteKR - Free Report) stand to benefit from this surge in demand.

Looking ahead, the outlook remains uncertain. The robust March performance, fueled by preemptive buying, is expected to taper off as consumers adopt a more cautious stance and focus on savings. With sentiment fragile and inflationary pressures persisting, the path forward for consumer spending hinges on future economic developments and policy outcomes.

Breaking Down Retail Sales Numbers

Sales at motor vehicle & parts dealers saw a month-on-month increase of 5.3%. Building material, garden equipment & supplies dealers and electronics & appliance outlets experienced a 3.3% and 0.8% rise, respectively.

Sales at food & beverage stores and clothing & clothing accessories stores witnessed 0.2% and 0.4% increases, respectively. Sales at health & personal care stores rose 0.7%. Sales at sporting goods, hobbies, musical instruments & bookstores jumped 2.4%.

General merchandise stores experienced a 0.6% increase in sales, while miscellaneous stores registered growth of 0.7%. Non-store retailers, primarily online, reported a 0.1% jump, while food services & drinking places saw a 1.8% increase. 

On the contrary, furniture & home furnishing stores experienced a 0.7% decline, while receipts at gasoline stations decreased 2.5%.

Past-Year Stock Price Performance of SFM, BJ, BJRI & KR

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4 Prominent Stocks

Sprouts Farmers: Product Innovation & Competitive Pricing

Sprouts Farmers, operating in a highly fragmented grocery industry, is a compelling option. The company has adopted a multifaceted approach to expand its customer base and cater to evolving consumer preferences. Through product innovation, targeted marketing and competitive pricing, Sprouts Farmers ensures that its offerings resonate with its diverse customer base. The company’s commitment to offering fresh, natural and organic products aligns with the growing consumer demand for healthier food options. Its store expansion and growing private label mix reflect solid momentum ahead.

The Zacks Consensus Estimate for Sprouts Farmers’ current financial-year sales and earnings per share (EPS) suggests growth of 11.9% and 24.3%, respectively, from the year-ago reported figure. SFM, which sports a Zacks Rank #1 (Strong Buy), has a trailing four-quarter earnings surprise of 15.1%, on average. You can see the complete list of today’s Zacks #1 Rank stocks here.

BJ's Wholesale: Membership & Digitization Drive Growth

BJ's Wholesale continues to demonstrate strong performance, fueled by its strategic focus on membership growth and digital innovations. The company remains committed to enhancing omnichannel capabilities and providing value to customers. These endeavors have contributed to growth in membership signups and renewals, resulting in higher membership fee income. Offering members convenient options such as same-day delivery, curbside pick-up, and buy online and pick up in-club, the company ensures an engaging and seamless digital shopping experience. BJ's Wholesale has been steadily increasing its footprint, targeting high-growth regions and underserved markets. 

The Zacks Consensus Estimate for BJ's Wholesale’s current financial-year sales and EPS suggests growth of 5.8% and 4.4%, respectively, from the year-ago reported figure. BJ, which carries a Zacks Rank #2 (Buy), has a trailing four-quarter earnings surprise of 12%, on average. (See the Zacks Earnings Calendar to stay ahead of market-making news.)

BJ's Restaurants: Menu Innovation & Cost Management

BJ's Restaurants is seeing better guest traffic, supported by enhancements in food quality, service consistency and menu offerings. Strong value perception and promotions are helping drive higher check averages. Operational efficiency is also improving, with disciplined cost control and margin expansion. Investments in kitchen execution, staffing and technology are streamlining workflows and boosting guest satisfaction. These efforts are helping BJ’s build sales momentum while positioning the company for continued improvement.

The Zacks Consensus Estimate for BJ's Restaurants’ current financial-year sales and EPS suggests growth of 3.2% and 12.9%, respectively, from the year-ago reported figure. BJRI, which carries a Zacks Rank #2, reported a positive earnings surprise of 34.3% in the last reported quarter.

Kroger: Leading With Fresh & Accelerating With Digital

Kroger continues to navigate a competitive and evolving retail landscape, leveraging its strong private-label offerings, including "Our Brands," digital expansion and strategic partnerships to maintain its market position. The company remains focused on enhancing its fresh product selection, personalized shopping experiences and digital ecosystem while investing in store remodels and automation to drive efficiency. 

The Zacks Consensus Estimate for Kroger’s current financial-year sales and EPS suggests growth of 1.4% and 6%, respectively, from the year-ago reported figure. KR, which carries a Zacks Rank #2, has a trailing four-quarter earnings surprise of 2.6%, on average.