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4 Retail Stocks to Consider for Your Holiday Shopping List

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4 Retail Stocks to Consider for Your Holiday Shopping List

With the holiday season approaching, retailers are gearing up to take advantage of the potential increase in consumer demand. Despite a challenging economic climate, consumer spending has remained resilient, thanks to healthy employment and wage gains. According to Mastercard SpendingPulse, U.S. retail sales (excluding automotive) are projected to grow by 3.7% during the holiday period from November 1 to December 24. In-store sales are expected to rise by 2.9%, while e-commerce sales are predicted to increase by 6.7%. Retailers are fully prepared to capitalize on this crucial period by providing fast, convenient, and secure shopping experiences both in-store and online.

The holiday season is extremely significant for retailers, as it often accounts for a large portion of their annual sales. It’s an opportunity for retailers to showcase their offerings, increase revenues, and solidify brand loyalty. Retailers are investing in restocking high-demand products, improving their online presence, engaging customers through social media, and optimizing logistics to ensure seamless operations.

In this article, we’ll highlight four stocks from the retail and wholesale sector that are well-positioned based on their strong fundamentals.

Past-Year Price Performance

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Top 4 Picks

1. Urban Outfitters (URBN)

Urban Outfitters is a leading lifestyle product and services company with solid business strategies and strong fundamentals. The company has been strengthening its direct-to-consumer business, improving productivity, and optimizing inventory levels. Its strategic growth initiative, FP Movement, and store expansion endeavors are impressive. The Zacks Consensus Estimate for Urban Outfitters’ current fiscal sales and EPS suggests a growth of 9% and 84.6% respectively, from the previous year. With a trailing four-quarter earnings surprise of 19.2%, Urban Outfitters is a Zacks Rank #1 (Strong Buy) stock with a VGM Score of A.

2. Walmart (WMT)

Walmart, the omnichannel retail giant, has been working tirelessly to strengthen its already dominant market position. The company has made significant improvements in its e-commerce initiatives, including acquisitions and partnerships. By elevating its merchandise offerings and ensuring diverse product assortments, Walmart continues to appeal to a wide range of customers. Walmart is a Zacks Rank #2 (Buy) stock with a trailing four-quarter earnings surprise of 11.6%. The Zacks Consensus Estimate for Walmart’s current financial-year sales and earnings suggest growth of 9.2% and 2.2% respectively from the previous year, with a VGM Score of A.

3. Ross Stores (ROST)

Ross Stores, an operator of off-price retail apparel and home fashion stores, is well-positioned for success in the dynamic retail landscape. The company’s store expansion strategy, coupled with its strong brand reputation and off-price retail model, allows Ross Stores to capture new customer segments and unlock potential sales growth. Ross Stores has a trailing four-quarter earnings surprise of 11.4% and the Zacks Consensus Estimate for its current financial-year sales and EPS suggests growth of 8.1% and 19.4% respectively. Ross Stores currently holds a Zacks Rank #2 and has a VGM Score of B.

4. Sprouts Farmers Market (SFM)

Sprouts Farmers Market has crafted a reputation within the grocery industry by prioritizing key areas that resonate with consumers. The company focuses on product innovation, e-commerce, expanding private-label offerings, and targeted marketing with everyday great pricing. By optimizing production, improving in-stock positions, and updating its stores to smaller formats, Sprouts Farmers Market is positioning itself for continued growth. The Zacks Consensus Estimate for Sprouts Farmers Market’s current fiscal sales and EPS suggests growth of 5.7% and 15.1% respectively from the previous year. It is a Zacks Rank #2 stock with a trailing four-quarter earnings surprise of 14.3% and a VGM Score of A.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.