The consumer discretionary sector is a part of the economy that consists of businesses selling non-essential goods and services, things that people buy when they have extra money to spend. This can include a wide range of companies, like those that sell cars, clothing, electronics, and even restaurant meals. When people feel confident about their financial situation, they’re more likely to splurge on these kinds of discretionary items, which can lead to higher profits for companies in this sector.
Investing in consumer discretionary stocks can be an interesting opportunity, especially when the economy is doing well. These stocks represent companies that could see a boost in sales when people have more disposable income. Therefore, if you believe the economy is on the upswing, investing in consumer discretionary stocks could be a smart move. However, it’s also important to remember that these types of companies can be hit hard during economic downturns, as people tend to cut back on non-essential purchases.
In a nutshell, consumer discretionary stocks can offer significant rewards, especially in times of economic prosperity. However, they also carry risks, particularly during economic slowdowns or recessions. As with any investment, understanding the sector and its relationship to economic cycles is key to making informed investment decisions. Given these points, let’s look at three trending consumer discretionary stocks to watch in the stock market right now.
Consumer Discretionary Stocks To Buy [Or Avoid] Now
- Nike, Inc. (NYSE: NKE)
- Amazon.com, Inc. (NASDAQ: AMZN)
- Lowe’s Companies, Inc. (NYSE: LOW)
Nike (NKE Stock)
Firstly, Nike, Inc. (NKE) is a global leader in athletic apparel, footwear, and accessories. Known for its innovative designs and prominent sponsorship deals with athletes, Nike’s ability to create and market high-demand products makes it a notable player in the consumer discretionary sector.
In May, Nike announced its most recent quarterly dividend. In detail, the company reported that its Board of Directors has declared a quarterly cash dividend of $0.340 per share on common stock. The dividend is payable to shareholders on July 5, 2023, to those of record at the end of the day, June 5, 2023. As a result of this dividend, Nike has an annual dividend yield of 1.15%.
Meanwhile, during Monday morning’s trading session, shares of Nike stock are trading lower off the open so far by 1.20% at $118.77 a share.
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Amazon.com, Inc. (AMZN Stock)
Second, Amazon.com, Inc. (AMZN) is a titan of e-commerce and cloud computing, with a vast array of services from online retail, and digital streaming, to artificial intelligence. Originally starting as an online bookstore, Amazon has grown into a global marketplace that’s reshaping retail.
At the end of last month, Amazon announced the financial results for its first quarter of 2023. It reported earnings of $0.31 per share, on revenue of $127.4 billion. Analysts had projected earnings of $0.21 per share and revenue of $124.5 billion, hence Amazon surpassed these expectations. The company’s revenue also showed growth of 9.4% when compared to the same quarter from the previous year. For its future prospects, Amazon has projected its revenue for the second quarter to be in the range of $127.0 billion to $133.0 billion.
Furthermore, off the opening bell on Monday morning, shares of Amazon stock are trading slightly higher so far up by 0.27%, trading at $110.56 per share.
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Lowe’s Companies, Inc. (LOW Stock)
Finally, Lowe’s Companies, Inc. (LOW) is the second-largest home improvement retailer worldwide. It offers products for maintenance, repair, remodeling, and home decorating. With its wide product range and strong online presence, Lowe’s has demonstrated resilience through various economic cycles, making it a notable player in the consumer discretionary sector.
In March, Lowe’s Companies shared the financial results for their fourth quarter of 2022. Specifically, they reported earnings of $2.28 per share, with revenue of $22.4 billion. This surpassed the predictions made by analysts, who had forecasted earnings of $2.21 per share and revenue of $22.8 billion. In addition, Lowe’s reported revenue growth of 5.2% when compared to the same period in the previous year.
Meanwhile, on Monday morning, shares of LOW stock have fallen off the open so far by 1.38%, currently trading at $200.46 a share.
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