Check Out These Cyclical Stocks In The Stock Market Today
As we start off a new trading week, cyclical stocks could be gaining attention. Namely, this section of the stock market is worth considering as the economy continues to heat up. To recap, February’s Consumer Price Index (CPI) came in 7.9% higher compared to last year, making it the fastest jump since 1982. To put things into perspective, the latest inflation reading even exceeded the previous high of 7.5% in January. Despite the high inflation, analysts are expecting retail sales to remain strong. Hence, with the strength of the economy, it would make sense for investors to take note of cyclical stocks now.
We could take a look at the likes of gourmet burger chain Red Robin (NASDAQ: RRGB). Last Friday, the company announced a solid quarter with a 40.1% year-over-year increase in revenue. According to the CEO, Red Robin sees improved staffing levels and growing dine-in sales volumes as the economy bounces back. Elsewhere, we have Lululemon (NASDAQ: LULU). The athleisure brand will be offering a women’s running shoe called Blissfeel. This would be its first footwear product as it attempts to make its mark in the highly competitive athletic footwear scene. With all that said, here are four other cyclical stocks to watch in the stock market today.
Cyclical Stocks To Buy [Or Avoid] Today
- JD.com Inc. (NASDAQ: JD)
- Lazydays Holdings Inc. (NASDAQ: LAZY)
- eBay Inc. (NASDAQ: EBAY)
- Restaurant Brands International Inc. (NYSE: QSR)
JD.com is a leading Chinese e-commerce company. Its cutting-edge retail infrastructure seeks to enable consumers to buy whatever they want, whenever they want it. Moreover, JD’s e-commerce platform provides over 550 million active customers with direct access to an unrivaled range of authentic, high-quality products. Its cross-border platform also enables brands from around the world to sell directly to Chinese consumers, even for companies that do not have a physical presence in China.
Just yesterday, the company announced that its logistics subsidiary has entered into an agreement to acquire Deppon Logistics. In brief, Deppon is an integrated, customer-centered logistics company that provides delivery services and warehousing management in China. JD will be taking over the Shanghai-listed company for $1.42 billion. This strategic takeover is part of the e-commerce company’s efforts to boost its freight and warehousing network.
Given Deppon’s extensive network and infrastructure, some analysts believe that the deal will strengthen JD’s capabilities. “We are positive on the deal and see clear synergies and decent potential for efficiency improvement for Deppon including optimization of labor, structure and technology with assistance from JDLn (JD Logistics),” Citi (NYSE: C) said in a note. With this acquisition in the works, should you buy JD stock?
Lazydays is an iconic brand in the RV industry that has been around for decades. The leading RV company has been consistently delivering the best RV sales and service in the industry. In fact, Lazydays has built a reputation for providing an outstanding customer experience with exceptional service and product expertise. It offers the top selection of RV brands from the country’s leading manufacturers, state-of-the-art service facilities, and accessories. The company strives to be the one-stop-shop for all RV enthusiasts. In the past month, LAZY stock has risen by over 20%.
On Thursday last week, the company reported its fourth-quarter and fiscal year 2021 financial results. Diving in, total revenue for the quarter was $322.5 million, up by 64.1% year-over-year. RV sales made up $291 million of the total revenue and RV unit sales excluding wholesale units were 3,211 for the quarter.
Moving along, net income for the fourth quarter was $16.9 million, up by a significant $14.7 million compared to last year. Lazydays also says RV shipments from OEMs have continued to improve, with towables approaching desired stock levels. In addition, inventories for higher-end towables, fifth wheels, and motorized units are improving as well thanks to strong demand. Given the solid quarter, would you invest in LAZY stock?
If you’ve ever bought something on the internet, chances are, you’ve come across eBay. In short, the company is a global e-commerce company that provides an online auction and shopping website. For the most part, this helps people and businesses buy and sell a wide variety of goods and services worldwide. On top of that, its platform is accessible in more than 190 markets worldwide, connecting millions of buyers and sellers.
A few days ago, the company hosted its first investor day under CEO Jamie Iannone. For starters, the e-commerce company repeated its previous 2022 financial guidance, forecasting revenue to range from flat to 3% higher. As for earnings, the company expects profits of $4.20 to $4.40 per share. Aside from that, eBay also made several product announcements.
Notably, it will be launching the eBay Vault, a new 31,000-square-foot secure storage facility for trading cards and collectibles and even luxury goods in the foreseeable future. Besides that, it also announced a digital wallet that will allow customers to store proceeds from sales or to use them to make purchases. With that being said, does EBAY stock have a spot in your portfolio?
Restaurant Brands International
Finally, we have Restaurant Brands International (RBI). Being one of the largest fast-food restaurant companies in the world, it brings in about $35 billion in sales annually. And on top of that, it operates over 29,000 restaurants in more than 100 countries.
For the uninitiated, RBI is the company that owns several of the most prominent and iconic fast-food brands. This includes Burger King, Popeyes, and Tim Horton to name a few. Last month, the company posted its fourth-quarter and full-year earnings and revenues that topped analysts’ expectations.
Diving in, RBI managed to pull in a revenue of $1.54 billion for the quarter, making it a 14% growth year-over-year. Next to that, global digital sales grew 6% year-over-year to $10 billion in 2021, representing nearly 30% of system-wide sales. As for profits, the company raked in $261 million in net income this quarter. Accordingly, earnings per share came in at $0.74 per share compared to the $0.70 per share analysts were expecting. The company also acquired the sandwich chain Firehouse Subs, whose same-store sales grew by 14.7%. All in all, given the steady quarterly performance, is QSR stock worth the investment?