Retail is heating up. A look at
11 hot retail ETFs to buy now
shows that the sector is dramatically outperforming the market - up
to four times over! That means retail stocks could be a great
investment right now for investors looking to buy into the stock
market on a dip. Five discount retail stocks I currently rate buys
99 Cents Only Stores
Consumer spending in the U.S. rose in March by the most in five
months, pointing to a recovery that may accelerate when the economy
creates more jobs. Another incredibly positive sign is that today
) just reported its first sales rise in four years - meaning the
bottom in housing is near and consumers are spending more on home
improvement and appliances. The icing on the cake is that global
markets are equally strong - for instance, this week we learned
Japan consumer confidence just hit its highest mark since 2007.
Yes, stocks have gotten a little volatile in May. But as I've
the old adage "sell in May and go away" is a bad
. The reality is that the recovery is still going strong and that
the recent consolidation. It's true that some luxury goods
companies are struggling and large discretionary expenses on
automobiles and homes are still unimpressive. But on the lower end
of the retail food chain, many stores are ringing up big
So if you have some spare cash and you're looking to invest in
retail, here are five discount
worth a look.
Retail Stock to Buy - Overstock.com OSTK
) is an online retailer offering closeout and discount merchandise
from home decor to jewelry to electronics. The company also
operates an online auction service akin to
) and even lists real estate for sale! As value conscious consumers
flock to the web to find the best deal, they are clicking on
Overstock.com more often due to its large scale and deep
The company was forecast to post a loss of -7 cents a share in
its most recent earnings report, but instead posted an impressive
16 cent EPS - a nearly 330% earnings surprise! Just imagine what
OSTK can do as consumer spending improves even more.
Retail Stock to Buy - Family Dollar FDO
Family Dollar Stores, Inc.
) is a chain of retail discount stores for low to lower-middle
income consumers in the United States. Items on sale at Family
Dollar include household products, snacks, pet food and housewares.
FDO stock controls approximately 6,600 stores in 44 states and the
District of Columbia.
While some retail stocks have seen troubles in the last year,
Family Dollar has been profitable for each of the last four
quarters and has topped Wall Street EPS forecasts in each period of
the last fiscal year. FDO stock also grown its earnings per share
for each of the last three consecutive quarters.
Retail Stock to Buy - Priceline.com PCLN
It's no secret that I love online retailer
), since I've written about it several times recently. PCLN allows
buyers to name their own price for everything from airline tickets
to rental cars to cruises. With its patented business model, the
company generates virtually all of its sales from travel-related
services. You may not think that travel spending is very high right
now, but the bottom line is that value-conscious consumers really
love Priceline's ability to 'haggle' on prices. This has allowed
the website to become an oasis for cash-strapped consumers and
generate huge numbers even during the recession.
Case in point: Pricelinereported strong earnings May 11
including EPS that doubled 2009 numbers, topping earnings
forecasts. And for the current quarter, PCLN stock said that its
strong first-quarter earnings results reflected a healthy increase
in hotel and international travel bookings through its Web sites -
boding very well for future Priceline.com sales.
CTRP, EXPE, OWW earnings also impress
Retail Stock to Buy - Costco COST
Costco Wholesale Corp.
) is one of the biggest forces in the world of discount retail.
Costco operates membership warehouses that offer a selection of
branded and private label products in a no-frills setting, allowing
consumers to buy everything from food to electronics to furniture.
COST stock operates about 560 warehouses in the U.S., and over 100
more in global markets like Canada, the United Kingdom, Korea and
Costco earnings are up again at the end of the month on May 27.
My fundamental analysis shows strong sales growth and earnings
growth behind COST stock, so there's a very good chance we'll see a
breakout report in just a few weeks. Now is your chance to buy in
to this discount retail stock before earnings.
Retail Stock to Buy - 99 Cents Only Stores NDN
99 Cents Only Stores
) sells consumer products through its retail stores. As no
surprise, NDN prides itself on a suite of goods sold for less than
$1, including kitchen items, toys, hardware and foodstuffs. The
company also sells merchandise through its Bargain Wholesale
division to retailers. As of 2009, the company operated 271 retail
stores with 200 in California, mainly the western United
As far as earnings history goes, you can't find a discount
with much better performance than 99 Cents Only. NDN stock has
topped EPS forecasts for each of the last four quarters by at least
40% and as much as 150%. NDN stock has also grown its earnings for
each of the last four consecutive quarters. That's momentum that
growth investors can take to the bank.
Retail Stock Upgrades, Downgrades (M, KSS, HD,
JWN, URBN, RL, GPS)
Retail Sales Continue to Grow but Demand Could
Soften (JCP, DDS, JWN)
11 Red Hot Retail ETFs to Buy (RXI, IYK, IYR,
XRT, XHB, RTH, VCR, RCD, PEZ, PEJ, PMR)