Christmas is just days away, and apparently, alot of people
still have a good deal of shopping to do over the next
According to a Consumer Reports holiday poll, conducted with
three weeks left before Christmas, 36% of gift givers --
approximately 66 million Americans -- still hadn't even begun their
holiday shopping. The survey also revealed that most people had
more than half of their shopping left to do.
This survey certainly suggests that there's going to be a mad
rush of holiday shoppers between now and Dec. 25. Moreover, the
probable big buying still to come is on top of very strongBlack
Friday and Cyber Monday sales.
So, what does thismean for the hot holiday retailers this year?
You guessed it -- big revenue, big profits, and a potential bounce
in theshares that traders can exploit for big gains.
Here are three of my favorites:
Abercrombie & Fitch (
One of the hottest retailers this season is Abercrombie &
Fitch. The often controversial teen-oriented retailer has been on a
wild ride this year, with the shares plunging throughout the summer
on weak sales and a weaker full-year outlook.
Then, in November, the company surprisedWall Street with a huge
revenue and earningsbeat due to strong sales and improved gross
margins. The stock surged on the news, but I don't think the run is
over yet, especially considering the store has been a hot trend for
holiday shoppers this year -- shoppers that still have a lot
ofmoney to spend.
Action to Take -->
Buy ANF at themarket price . Set stop-loss at $43.20. Set
initialprice target at $54 for a potential 15% gain in two
Limited Brands (
Perhaps best known for its Victoria Secret intimate apparel stores,
this women's specialty retailer continues to see strong sales, not
only at Victoria's Secret, but also in its personal care products
via the Bath & Body Works brands. The company's strong fiscal
position recently allowed it to declare aspecial dividend to
shareholders in early December, in front of the likelihood of
higherdividend taxes next year.
One aspect of the company that I thinkwill help drive its stock
price higher is that Limited Brands has embarked on plans to expand
their international footprint, and to make its brands household
names around the world. The company already announced that it was
going to expand into growth areas such asemerging markets ,
including the cash-rich Middle East nation of Kuwait.
Technically speaking, I like the trading bounce seen in the
shares in November, a bounce that has come back off its highs to
what I now think is a great chance to pick up the stock in front of
what will likely be very strong holiday rush sales.
Action to Take -->
Buy LTD at the market price. Set stop-loss at $46.53. Set initial
price target at $55.64 for a potential 10% gain in two months.
Lululemon Athletica (Nasdaq: LULU)
The sleek athletic apparel maker sells what's been described as
yoga-inspired clothing, and that inspiration has resonated well
with consumers. The company easily bested third-quarter revenue
andearnings expectations. Analysts cited a number of positives as
reasons why the company did so well in Q3, including strong
execution, an attractive product mix and outstanding online
In 2012, the shares have been volatile, jumping to big gains
early in the year, and then pulling back sharply from May to
August. After a boost from August through September, the shares
stabilized. However, recent earnings results, along with what
should be strong holiday sales, could definitely send the shares
skyrocketing again in the months ahead. With Lululemon recently
breaking out above the 50-day and 200-day moving averages, now is
the time to get on this stock before the real gains resume.
Action to Take -->
Buy LULU at the market price. Set stop-loss at $68.84. Set initial
price target at $82.30 for a potential 10% gain in two
This article originally appeared on TradingAuthority.com:
3 Retailers That Could Offer Big Gains If You Buy
Before the Holiday Shopping Rush