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4 Buy-Ranked Retails Stocks to Consider Ahead of Black Friday
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Thanksgiving is just round the corner, marking the start of a busy period for retail stocks. While Thanksgiving is the unofficial start of the holiday shopping season, Black Friday, the day after Thanksgiving, is one of the busiest shopping days of the year.
According to a survey released by the National Retail Federation and Prosper Insights & Analytics last week, about 164 million people or 69% of Americans plan to shop over the weekend which includes Thanksgiving Day, Black Friday, Small Business Saturday and Sunday as well as Cyber Monday. Both online and brick-and-mortar stores provide competitive offers and discounts during this period to attract customers.
Black Friday is expected to be the busiest day this weekend with about 115 million people planning to shop this day. While 71 million people plan to shop on Saturday, Cyber Monday is expected to see about 78 million shoppers. With just 2% of consumers having completed their holiday shopping, Black Friday will be a very important day for e-commerce stocks and retailers with many companies reporting their highest profits on this day. The holiday season gives retailers the opportunity to improve traffic and bring in the numbers through promotions, early-store openings, heavy discounts, as well as free shipping on online purchases. People queuing up outside stores from the wee hours to take advantage of attractive deals and offers including early bird discounts is not an uncommon sight during this period.
Retailers are gearing up for the holiday season with companies like Target Corporation (TGT - Free Report) announcing the hiring of additional team members for the peak holiday season. Target has introduced Weekend Deals this year featuring marquee prices on new items every weekend based on what customers are looking for at different times throughout the season. The company also said it would be offering some of its lowest prices of the year during big events like Black Friday and Cyber Monday. Companies like Kohl’s Corporation (KSS - Free Report) and Amazon have also announced their Black Friday deals.
Low household debt burdens, growing consumer confidence, lower personal savings and higher income generation bode well for the upcoming holiday season. In fact, spending in U.S. households ramped up in October with retail sales (excluding autos, gas and restaurants) growing 0.1% over September and 4.3% from the year-ago period (NRF data).
Stock Picks
With the holiday season round the corner, here is a look at four retail stocks that boast of a favorable Zacks Rank and a VGM Score of A or B. Our research shows that stocks with a VGM Score of A or B when combined with a Zacks Rank #1 (Strong Buy) or 2 (Buy) offer the best upside potential.
Dollar General (DG - Free Report) : Dollar General is focused on helping shoppers save time and money. Products sold at its stores include food, snacks, health and beauty aids, cleaning supplies, basic apparel, housewares and seasonal items at everyday low prices. As of August 19, 2017, Dollar General operated 14,000 stores in 44 states.
Dollar General, a Zacks Rank #2 stock has a pretty good earnings track record with the company surpassing expectations in three of the last four quarters with an average surprise of 1.8%. Estimated earnings growth for the current year is 0.5% while the VGM Score is A. Dollar General’s shares are up 17.4% year to date, significantly outperforming the 2.2% rally of the industry it belongs to. You can see the complete list of today’s Zacks #1 Rank stocks here.
Dollar Tree, Inc. (DLTR - Free Report) : Dollar Tree is a leading operator of discount variety stores in North America. The company has more than 14,500 stores across 48 states and five Canadian provinces with the stores operating under the brands of Dollar Tree, Family Dollar and Dollar Tree Canada.
The Zacks Rank #2 stock, which has a VGM Score of A, has surpassed earnings expectations in three of the last four quarters with an average surprise of 4.9%. Estimated earnings growth for the current year is 22.4%. Dollar Tree’s shares are up 25.8% year to date, significantly outperforming the 2.2% rally of the industry it belongs to.
Ross Stores, Inc. (ROST - Free Report) : Ross Stores operates Ross Dress for Less, the largest off-price apparel and home fashion chain in the United States that offers first-quality, in-season, name brand and designer apparel, accessories, footwear, and home fashions for the entire family at savings of 20% - 60% off department and specialty store regular prices every day. As of October 28, 2017, Ross Dress for Less had 1,412 locations across 37 states, the District of Columbia and Guam.
Ross Stores also operates 215 dd’s DISCOUNTS across 16 states (as of October 28, 2017) where a more moderately-priced assortment of first-quality, in-season, name brand apparel, accessories, footwear, and home fashions for the entire family is available at savings of 20% - 70% off moderate department and discount store regular prices every day.
The Zacks Rank #2 stock has a strong earnings track record having surpassed expectations in each of the last four quarters with an average surprise of 5.5%.
The stock has seen the Zacks Consensus Estimate for current-year earnings being revised 1.6% upward over the last 7 days. Estimated earnings growth for the current year is 15.4% while the VGM Score is B. Ross Stores’ shares are up 10.9% year to date, outperforming the 2.2% rally of the industry it belongs to.
Wal-Mart Stores, Inc. (WMT - Free Report) : Wal-Mart operates through more than 11,600 stores under 59 banners in 28 countries and e-commerce websites in 11 countries. The company, which reported strong results for the third quarter of fiscal 2018, raised its outlook as well. The Zacks Rank #2 stock, which has a VGM Score of B, has seen the Zacks Consensus Estimate for current-year earnings being revised 0.7% upward over the last 7 days.
Wal-Mart’s shares are up 41% year to date, outperforming the 30.3% rally of the industry it belongs to.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
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4 Buy-Ranked Retails Stocks to Consider Ahead of Black Friday
Thanksgiving is just round the corner, marking the start of a busy period for retail stocks. While Thanksgiving is the unofficial start of the holiday shopping season, Black Friday, the day after Thanksgiving, is one of the busiest shopping days of the year.
According to a survey released by the National Retail Federation and Prosper Insights & Analytics last week, about 164 million people or 69% of Americans plan to shop over the weekend which includes Thanksgiving Day, Black Friday, Small Business Saturday and Sunday as well as Cyber Monday. Both online and brick-and-mortar stores provide competitive offers and discounts during this period to attract customers.
Black Friday is expected to be the busiest day this weekend with about 115 million people planning to shop this day. While 71 million people plan to shop on Saturday, Cyber Monday is expected to see about 78 million shoppers. With just 2% of consumers having completed their holiday shopping, Black Friday will be a very important day for e-commerce stocks and retailers with many companies reporting their highest profits on this day. The holiday season gives retailers the opportunity to improve traffic and bring in the numbers through promotions, early-store openings, heavy discounts, as well as free shipping on online purchases. People queuing up outside stores from the wee hours to take advantage of attractive deals and offers including early bird discounts is not an uncommon sight during this period.
Retailers are gearing up for the holiday season with companies like Target Corporation (TGT - Free Report) announcing the hiring of additional team members for the peak holiday season. Target has introduced Weekend Deals this year featuring marquee prices on new items every weekend based on what customers are looking for at different times throughout the season. The company also said it would be offering some of its lowest prices of the year during big events like Black Friday and Cyber Monday. Companies like Kohl’s Corporation (KSS - Free Report) and Amazon have also announced their Black Friday deals.
Low household debt burdens, growing consumer confidence, lower personal savings and higher income generation bode well for the upcoming holiday season. In fact, spending in U.S. households ramped up in October with retail sales (excluding autos, gas and restaurants) growing 0.1% over September and 4.3% from the year-ago period (NRF data).
Stock Picks
With the holiday season round the corner, here is a look at four retail stocks that boast of a favorable Zacks Rank and a VGM Score of A or B. Our research shows that stocks with a VGM Score of A or B when combined with a Zacks Rank #1 (Strong Buy) or 2 (Buy) offer the best upside potential.
Dollar General (DG - Free Report) : Dollar General is focused on helping shoppers save time and money. Products sold at its stores include food, snacks, health and beauty aids, cleaning supplies, basic apparel, housewares and seasonal items at everyday low prices. As of August 19, 2017, Dollar General operated 14,000 stores in 44 states.
Dollar General, a Zacks Rank #2 stock has a pretty good earnings track record with the company surpassing expectations in three of the last four quarters with an average surprise of 1.8%. Estimated earnings growth for the current year is 0.5% while the VGM Score is A. Dollar General’s shares are up 17.4% year to date, significantly outperforming the 2.2% rally of the industry it belongs to. You can see the complete list of today’s Zacks #1 Rank stocks here.
Dollar Tree, Inc. (DLTR - Free Report) : Dollar Tree is a leading operator of discount variety stores in North America. The company has more than 14,500 stores across 48 states and five Canadian provinces with the stores operating under the brands of Dollar Tree, Family Dollar and Dollar Tree Canada.
The Zacks Rank #2 stock, which has a VGM Score of A, has surpassed earnings expectations in three of the last four quarters with an average surprise of 4.9%. Estimated earnings growth for the current year is 22.4%. Dollar Tree’s shares are up 25.8% year to date, significantly outperforming the 2.2% rally of the industry it belongs to.
Ross Stores, Inc. (ROST - Free Report) : Ross Stores operates Ross Dress for Less, the largest off-price apparel and home fashion chain in the United States that offers first-quality, in-season, name brand and designer apparel, accessories, footwear, and home fashions for the entire family at savings of 20% - 60% off department and specialty store regular prices every day. As of October 28, 2017, Ross Dress for Less had 1,412 locations across 37 states, the District of Columbia and Guam.
Ross Stores also operates 215 dd’s DISCOUNTS across 16 states (as of October 28, 2017) where a more moderately-priced assortment of first-quality, in-season, name brand apparel, accessories, footwear, and home fashions for the entire family is available at savings of 20% - 70% off moderate department and discount store regular prices every day.
The Zacks Rank #2 stock has a strong earnings track record having surpassed expectations in each of the last four quarters with an average surprise of 5.5%.
The stock has seen the Zacks Consensus Estimate for current-year earnings being revised 1.6% upward over the last 7 days. Estimated earnings growth for the current year is 15.4% while the VGM Score is B. Ross Stores’ shares are up 10.9% year to date, outperforming the 2.2% rally of the industry it belongs to.
Wal-Mart Stores, Inc. (WMT - Free Report) : Wal-Mart operates through more than 11,600 stores under 59 banners in 28 countries and e-commerce websites in 11 countries. The company, which reported strong results for the third quarter of fiscal 2018, raised its outlook as well. The Zacks Rank #2 stock, which has a VGM Score of B, has seen the Zacks Consensus Estimate for current-year earnings being revised 0.7% upward over the last 7 days.
Wal-Mart’s shares are up 41% year to date, outperforming the 30.3% rally of the industry it belongs to.
Zacks' Hidden Trades
While we share many recommendations and ideas with the public, certain moves are hidden from everyone but selected members of our portfolio services. Would you like to peek behind the curtain today and view them?
Starting now, for the next month, I invite you to follow all Zacks' private buys and sells in real time from value to momentum...from stocks under $10 to ETF to option movers...from insider trades to companies that are about to report positive earnings surprises (we've called them with 80%+ accuracy). You can even look inside portfolios so exclusive that they are normally closed to new investors.
Click here for Zacks' secret trade>>