Stocks

Podcast: This Week Is All About Retail Earnings

Home Depot, Macy’s, Target, and many more retailers report earnings this week. 2019 is looking to be another lackluster year for stock pickers—but three mutual funds are beating the market.

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It’s well short of the broader S&P 500’s 26% return this year. Now, this isn’t a new trend. For years, brick-and-mortar stores have been hurt by the rise of online retailers. That situation has been further complicated by tariffs and an economy that is potentially slowing in 2019.

We’ll hear from a bevy of retailers when they report earnings this week.

Home Depot (HD), Kohl’s (KSS), and TJX (TJX) release their third-quarter results on Tuesday. They’re followed by Lowe’s (LOW), Target (TGT), and L Brands (LB) on Wednesday. And on Thursday, we’ll hear from Macy’s (M), Nordstrom (JWN), Ross Stores (ROST), and Gap (GPS).

—in 2019. In other words: It’s another lackluster year for stockpickers.

The market beaters are the Fidelity Growth Company (ticker: FDGRX), Vanguard Dividend Growth (VDIGX), and T. Rowe Price Mid-Cap Growth (RPMGX) funds. Each benefits from having long-tenured portfolio managers, but they all take different approaches to investing.

Fidelity Growth has ridden gains in technology giants. T. Rowe Price Mid-Cap Growth has scored by investing in lesser-known health-care stocks. And Vanguard Dividend Growth may be the only large mutual fund whose top holding is Coca-Cola (KO). That’s a growth stock of yesteryear.

The tech giant’s rally has been unstoppable, and that’s even as its market valuation approaches a whopping $1.2 trillion.

Valuations of that magnitude are rare. The coming initial public offering of the oil company Saudi Aramco has raised eyebrows for its potential $1.5 trillion valuation. But even that might not be enough to top Apple. Because the highest analyst price target for Apple stock (AAPL) would value the iPhone-maker in the same neighborhood.

Next year will bring new 5G iPhones and a chance for the company to continue growing its services revenues. It could be what Apple stock needs to reach that next level.

Numbers by Barron’s is our daily podcast. Find out more here.

Write to host Nicholas Jasinski at nicholas.jasinski@barrons.com

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