Chicago, IL – January 22, 2025 – 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, Abercrombie & Fitch Co. ANF, Amazon.com, Inc. AMZN, Costco Wholesale Corp. COST and Walmart Inc. WMT.
Here are highlights from Wednesday’s Analyst Blog:
December Retail Sales Give Stellar Finish to 2024: 4 Stocks to Buy
The retail sector concluded 2024 on a remarkable note, signaling robust consumer spending and economic resilience. According to the Commerce Department, December retail sales rose 0.4%, building on November's upwardly revised reading of 0.8% gain. Total retail sales reached $729.2 billion, with standout performance in categories such as miscellaneous stores, sporting goods and hobby stores, and furniture and home furnishings outlets.
Consumers defied challenges spurred by a resilient labor market and steady wage growth. Retailers capitalized on the season with compelling promotional strategies, enticing shoppers to spend on big-ticket items and essentials alike. The Federal Reserve's strategic approach to rate cuts and easing inflation allowed consumers to manage their budgets better.
As Americans stepped up spending, retailers such as Abercrombie & Fitch Co., Amazon.com, Inc., Costco Wholesale Corp. and Walmart Inc. reaped benefits.
Breaking Down Retail Sales Numbers
Sales at motor vehicle & parts dealers saw a month-on-month increase of 0.7%. Furniture & home furnishing stores and electronics & appliance outlets experienced a 2.3% and 0.4% rise, respectively. Sales at food & beverage stores and clothing & clothing accessories stores witnessed 0.8% and 1.5% increases, respectively.
Sales at sporting goods, hobbies, musical instruments & bookstores rose 2.6%, while receipts at gasoline stations increased 1.5%. Non-store retailers, primarily online, reported a 0.2% jump. General merchandise stores experienced a 0.3% increase in sales, while miscellaneous stores registered growth of 4.3%.
On the contrary, building material, garden equipment & supplies dealers saw a 2% decline. Sales at health & personal care stores fell 0.2%. Food services & drinking places saw a 0.3% decrease.
4 Prominent Retail Stocks
Abercrombie & Fitch: Brand Visibility & Global Expansion
Abercrombie & Fitch stands out as a strong investment choice. The company excels in integrating digital and physical retail channels, offering a seamless shopping experience and driving higher customer satisfaction and loyalty. Strategic marketing initiatives, particularly targeted campaigns in key markets, have been effective in boosting brand visibility and customer acquisition.
The introduction of innovative product lines meets specific customer needs and broadens the brand's appeal. ANF announced an upward revision in its net sales outlook for the fourth quarter, attributing to a successful holiday sales season. The company now expects fourth-quarter net sales growth to range between 7% and 8%, up from the prior forecast of 5% to 7%.
This leading, global, omnichannel specialty retailer of apparel and accessories for men, women and kids has a trailing four-quarter earnings surprise of 14.8%, on average. The Zacks Consensus Estimate for Abercrombie & Fitch’s current financial-year sales and EPS suggests growth of 15.1% and 69.3% from the year-ago period. The company sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Amazon: Dominating with Robust Logistics Network
Amazon is also worth considering. The company’s robust e-commerce platform, renowned for its vast product selection and efficient delivery services, continues to be a primary driver of revenue growth. Prime membership, a cornerstone of Amazon's success, not only fosters customer loyalty but also drives recurring revenues through subscription fees, offering members exclusive access to a myriad of services, such as expedited shipping.
The Zacks Consensus Estimate for Amazon’s current financial-year sales and EPS suggests growth of 10.9% and 82.4%, respectively, from the year-ago reported figure. AMZN, which sports a Zacks Rank #1, has a trailing four-quarter earnings surprise of 25.9%, on average.
See the Zacks Earnings Calendar to stay ahead of market-making news.
Costco: Leveraging Membership Model for Success
Costco has navigated market ups and downs effectively, driven by strategic investments, a customer-centric approach, merchandise initiatives and a strong emphasis on memberships. By identifying untapped markets and tailoring offerings to customer preferences, Costco has deepened its market presence. The company’s high membership renewal rates, efficient supply chain management and bulk purchasing power ensure competitive pricing and foster strong customer loyalty.
The Zacks Consensus Estimate for Costco’s current financial-year sales and EPS implies growth of 7.2% and 11.8%, respectively, from the year-ago period’s actuals. This Zacks Rank #2 (Buy) company has a trailing four-quarter earnings surprise of 2%, on average.
Walmart: Embracing Technology for Growth
Walmart has been working to strengthen its already formidable presence in the market. The company has embarked on a series of strategic e-commerce initiatives, encompassing acquisitions, partnerships and significant improvements in its delivery and payment systems. Walmart is committed to elevating its merchandise offerings, ensuring a diverse and appealing product assortment. Innovation extends to its supply chain, wherein the company is enhancing capacity and introducing cutting-edge solutions.
The Zacks Consensus Estimate for Walmart’s current financial-year sales and EPS suggests growth of 4.8% and 11.3%, respectively, from the year-ago reported numbers. This Zacks Rank #2 company has a trailing four-quarter earnings surprise of 9.3%, on average.
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Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Previewreports. If you want an email notification each time Sheraz publishes a new article, please click here>>>
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