Technology

ETFs & Stocks to Tap on Highest Retail Sales Gain in 1.5 Years

After rising 0.7% in January and dropping 0.2% in February, U.S. retail sales increased 1.6% in March, breezing past market expectations of a 0.9% rise. This marked the biggest increase in retail trade since September 2017 helped by sales of motor vehicles and a range of other goods, per tradingeconomics. As many as 12 of 13 major retail categories showed month-over-month increases (read: Beat Q1 Earnings Woes With These Sector ETFs & Stocks).

With this, growth worries in the United States cooled down a bit. Against this backdrop, we recommend a few ETFs and stocks from areas where sales shone in the month.

Motor Vehicle & Parts Dealers

Sales at motor vehicle & parts dealers grew 3.1%, the maximum since September 2017, versus a decline of 0.1% in the prior month.

First Trust NASDAQ Global Auto Index Fund CARZ

The underlying NASDAQ OMX Global Auto Index of the fund is designed to track the performance of the largest and most-liquid companies engaged in manufacturing automobiles.

AutoZone Inc. AZO

This Zacks Rank #2 (Buy) company is a leading distributor of automotive replacement parts and accessories with stores in the United States, Puerto Rico, Mexico and Brazil. It hails from a top-ranked Zacks industry (top 36%).

Clothing Stores

Sales at clothing stores grew 2%, the largest gain since last May against a 1.8% drop in February.

SPDR S&P Retail ETF XRT

The underlying S&P Retail Select Industry Index represents the retail sub-industry portion of the S&P TMI. Apparel Retail takes about one-fourth of the fund (read: Consumer ETFs: Bull Market Winners With Room to Run in 2019).

Buckle Inc. BKE

This Zacks Rank #1 (Strong Buy) company is a leading retailer of medium to better-priced casual apparel, footwear and accessories for young men and women. It comes from a top-ranked Zacks industry (top 30%).

Restaurants and Bars

Sales at restaurants and bars were up 0.8%, the highest since last July.

Invesco Dynamic Food & Beverage ETF PBJ

Though the fund has a Zacks Rank #4 (Sell) over the medium term, the latest retail sales may give it a boost. The underlying index of the fund — the Dynamic Food & Beverage Intellidex Index —comprises stocks of 30 U.S. food and beverage companies. These are principally engaged in the manufacture, sale or distribution of food and beverage products, agricultural products and products related to the development of new food technologies (read: Valuations Still High in Consumer Staples: 6 ETFs to Shun).

Chipotle Mexican Grill Inc. CMG

The company operates Chipotle Mexican Grill restaurants, which serve a focused menu of burritos, tacos, and burrito bowls (a burrito without the tortilla) and salads with fresh ingredients. The stock holds a Zacks Rank #2.

Health & Personal Care Stores

Sales at health & personal care grew 0.2%, after expansion of 0.6% in February and 2.4% in January, respectively.

The Obesity ETF SLIM

The underlying Solactive Obesity Index tracks the performance of global companies focusing on obesity-related diseases, weight-loss programs, weight-loss supplements and plus-sized apparel.

Unilever Plc UL

The Zacks Rank #1 company is engaged in manufacturing of branded and packaged consumer goods, including food, detergents and personal care products. It comes from a top-ranked Zacks sector (top 4%).

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AutoZone, Inc. (AZO): Free Stock Analysis Report

SPDR S&P Retail ETF (XRT): ETF Research Reports

First Trust NASDAQ Global Auto Index Fund (CARZ): ETF Research Reports

Invesco Dynamic Food & Beverage ETF (PBJ): ETF Research Reports

Unilever PLC (UL): Free Stock Analysis Report

Buckle, Inc. (The) (BKE): Free Stock Analysis Report

Chipotle Mexican Grill, Inc. (CMG): Free Stock Analysis Report

The Obesity ETF (SLIM): ETF Research Reports

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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.