The Zacks Analyst Blog Highlights: Target, Wal-Mart Stores, Citi Trends, Hanesbrands and Deckers Outdoor
CHICAGO, Sept. 23, 2014 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include the Target Corp. (NYSE:TGT-Free Report), Wal-Mart Stores Inc. (NYSE:WMT-Free Report), Citi Trends, Inc. (Nasdaq:CTRN-Free Report), Hanesbrands Inc. (NYSE:HBI-Free Report) and Deckers Outdoor Corp. (Nasdaq:DECK-Free Report).
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
Here are highlights from Monday's Analyst Blog:
Eyes Turn to Holiday Season: 3 Hot Retail Stocks to Buy
The economy looks much more balanced now with no imminent hike in interest rates, consumer confidence moving north, job market conditions gradually improving and the bond-buying program nearing its end. Retailers are thus hopeful of solid business and are gearing up for the busiest part of the year.
Retailers need to be prepared this holiday season to make the most of it. They need to grab every opportunity, and try all means to drive in consumers. Be it early-hour store openings, promotional events, free shipping on online purchases or heavy discounts, retailers will try every trick to boost sales in the holiday season.
Betting on regained consumer confidence, retail bellwethers such as Target Corp. (NYSE:TGT-Free Report) and Wal-Mart Stores Inc. (NYSE:WMT-Free Report) have also announced their hiring plans for the upcoming holiday season in anticipation of heavy store traffic. While Target and Kohl's plans to add 70,000 and 67,000 heads to their workforce, respectively, Wal-Mart plans to hire 60,000 seasonal staff. After the data breach debacle that tainted its image, Target is trying to win back customers in the upcoming holiday season with its expanded toy collection, including the boutique brand toys.
Favorable Economic Indicators Inspiring Confidence
Gradual recovery in the housing market, strengthening manufacturing sector and an improving employment picture is shaping up well for an economy that registered GDP growth of 4.2% in the second quarter of 2014. This was better than the previous estimate of 4% and a 2.1% decline in the first quarter.
Consumer confidence – a key determinant of the economy's health – improved significantly, reaching the pinnacle this August since October 2007. This implies better prospects for the economy in the second half of 2014 than the first half. We expect this positive sentiment to encourage consumer spending, which accounts for over two-thirds of U.S. economic activity, and help retailers to make the most of it.
According to recent Conference Board data, the Consumer Confidence Index increased to 92.4 in August from 90.3 in July. The preliminary data for September, released by University of Michigan and Thomson Reuters, showed that the consumer sentiment index jumped to 84.6 from the August reading of 82.5, buoyed by improving fundamentals. Notably, the unemployment rate declined to 6.1% in August from 7.2% in the prior-year period and 6.2% in the previous month.
Promising Picks
Banking on its wide spectrum, the Retail/Wholesale sector remains a lucrative investment opportunity, and identifying its future winners would be a prudent idea before taking an investment decision. The data compiled by National Retail Federation hints at a sales increase of at least 3.9% in the second half of the year compared with 2.9% in the first half. Here we have highlighted three Retail/Wholesale stocks that could enrich your portfolio this holiday season.
We suggest investing in Citi Trends, Inc. (Nasdaq:CTRN-Free Report), the retailer of urban fashion apparel and accessories. The stock holds a Zacks Rank #1 (Strong Buy) and has amassed a year-to-date return of roughly 28.4%. Though the stock looks pricey with a forward P/E (price-to-earnings) multiple of 39.89x, it should not disappoint investors given the company's long-term expected earnings growth of 15.0%. This Savannah, GA-based company delivered an average positive earnings surprise of 18.6% over the trailing four quarters.
Hanesbrands Inc. (NYSE:HBI-Free Report), a designer and manufacturer of basic apparel in the United States, is another stock to bet on. This Zacks Rank #1 stock has amassed a year-to-date return of 55.8% and has a long-term earnings growth rate of 14.7%. Shares of this Winston-Salem, NC-based company trades at a forward P/E of 19.49x, a discount to the industry average and are also attractive from an earnings growth perspective. The company delivered an average positive earnings surprise of 15.5% over the trailing four quarters.
Another stock that investors may look forward to is Deckers Outdoor Corp. (Nasdaq:DECK-Free Report), the designer, marketer and distributor of footwear, apparel and accessories for outdoor activities and casual lifestyle. Also a Zacks Rank #1 stock, this trades at a forward P/E of 20.68x, a slight premium to the industry average, and has amassed a year-to-date return of 18.2%. This Goleta, CA-based company posted an average positive earnings surprise of 26.6% over the trailing four quarters, and has a long-term earnings growth rate of 14% that makes it look attractive.
We believe that the above stocks boast strong fundamentals and growth prospects that can quench investors' appetites for market winners.
Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.
About Zacks Equity Research
Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.
Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.
Zacks "Profit from the Pros" e-mail newsletter provides highlights of the latest analysis from Zacks Equity Research. Subscribe to this free newsletter today.
About Zacks
Zacks.com is a property of Zacks Investment Research, Inc., which was formed in 1978. The later formation of the Zacks Rank, a proprietary stock picking system; continues to outperform the market by nearly a 3 to 1 margin. The best way to unlock the profitable stock recommendations and market insights of Zacks Investment Research is through our free daily email newsletter; Profit from the Pros. In short, it's your steady flow of Profitable ideas GUARANTEED to be worth your time! Register for your free subscription to Profit from the Pros.
Get the full Report on TGT - FREE
Get the full Report on WMT - FREE
Get the full Report on CTRN - FREE
Get the full Report on HBI - FREE
Get the full Report on DECK - FREE
Follow us on Twitter: http://twitter.com/zacksresearch
Join us on Facebook: http://www.facebook.com/home.php#/pages/Zacks-Investment-Research/57553657748?ref=ts
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Media Contact
Zacks Investment Research
800-767-3771 ext. 9339
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit http://www.zacks.com/performance for information about the performance numbers displayed in this press release.
Logo - http://photos.prnewswire.com/prnh/20101027/ZIRLOGO
SOURCE Zacks Investment Research, Inc.
Share this article