Are These The Best Consumer Stocks To Buy For 2022?
Consumers remain a key focus for investors in the stock market today. Because of this consumer stocks would, naturally, be in the limelight as well. After all, following last week’s red hot Consumer Price Index readings, investors have another piece of economic data to consider. That is, the U.S. Census Bureau’s data on retail sales throughout January is due tomorrow. Across the board, tomorrow’s reading will likely weigh in on organizations that focus on serving consumers.
As it stands, economists’ consensus is pointing to a 2% year-over-year rise. This would be a notable jump from December’s decrease of 1.9%. Moreover, estimates for sales excluding automobiles, gas, building materials, and food services are currently suggesting a rise of 0.8% year-over-year. This would be in comparison to a year-over-year decline of 2.3% the month prior. By and large, economists seem to be generally optimistic about tomorrow’s retail sales results. Not to mention, retail names such as Shopify (NYSE: SHOP) and Fiverr (NYSE: FVRR) will be reporting earnings later this week as well.
Earnings aside, there are also ongoing merger talks between Monster Beverage (NASDAQ: MNST) and Constellation Brands (NYSE: STZ) now. According to Bloomberg sources, should things go smoothly, we could see a deal within the next few weeks. As a result, both of these consumer staples giants are turning heads in the stock market today. Overall, some would argue that consumer stocks are in an interesting position now. Having read all of this, you might be keen to invest in some yourself. In that case, here are three names to take note of now.
Top Consumer Stocks To Buy [Or Sell] Right Now
- Restaurant Brands International (NYSE: QSR)
- Marriott International Inc. (NASDAQ: MAR)
- Walmart Inc. (NYSE: WMT)
Restaurant Brands International Inc.
First up, we have Restaurant Brands International (RBI), one of the largest quick-service restaurant companies in the world. It has approximately $35 billion annual system-wide sales and over 29,000 restaurants in more than 100 countries. In fact, the company owns some of the world’s most prominent and iconic fast-food brands including Burger King, Popeyes, and Tim Hortons among others.
Today, RBI reported its full-year and fourth-quarter financials. Diving in, the company’s global fourth-quarter total revenue grew by 14% year-over-year to $1.54 billion. Global digital sales grew 6% year-over-year to $10 billion in 2021, representing nearly 30% of system-wide sales. The company also notes that restaurant growth returns to over 1,200 units with Tim Hortons and Popeyes gaining traction internationally.
The company also returned $1.5 billion of capital to shareholders in 2021, and acquired Firehouse Subs, and increased its target dividend for 2022. “Our growth throughout 2021 resulted in strong free cash flow, allowing us to make important investments in our business while returning over $1.5 billion of capital to shareholders and acquiring a new restaurant brand in Firehouse Subs. I am excited for what lies ahead for our family of four iconic brands and am confident in the strength of our team, our franchisees, and our strategies to drive long-term growth and value creation,” concluded José Cil, Chief Executive Officer of RBI. Given this piece of news, is QSR stock worth adding to your portfolio?
Marriott International is a multinational company that operates and franchises lodging. This includes hotels, residential, and timeshare properties. Accordingly, it is one of the largest hotel chains in the world by the number of rooms available. The company also offers Marriott Bonvoy, its highly-awarded travel program. MAR stock is up by 3% on today’s opening bell after reporting its fourth-quarter financials as well.
Firstly, comparable systemwide revenue per available room (RevPAR) increased by 124.5% worldwide compared to a year ago. This comes as each of its regions saw meaningful recovery in the fourth quarter. Secondly, its net income for the quarter was $468 million compared to a net loss of $164 million a year ago. Impressively, the company has also added more than 86,000 rooms globally in 2021. This includes approximately 43,000 rooms in international markets and a total of over 18,000 conversion rooms.
Last month, the company also provided an update of its development progress in 2021 and an overview of key trends that will shape the industry. Marriott International says that it signed 599 agreements during 2021, representing approximately 92,000 rooms. Half of this amount is outside the U.S. and Canada. It also says that the leisure boom continues to boom. Leisure demand has led the travel recovery and the company believes that this will be a trend that will continue into 2022. All things considered, is MAR stock a top consumer stock to buy right now?
Another name to consider among the top consumer stocks today would be Walmart. As the biggest retailer in the world, this is understandable. Whether it is consumer staples in the form of groceries or the latest consumer tech offerings, Walmart delivers. This is the case both figuratively and literally as the company actively works to expand its delivery services. For a sense of scale, Walmart currently serves about 220 million customers per week across its network of stores. The likes of which consist of 10,500 stores and clubs that are present in 24 countries.
In fact, Walmart appears to be actively keeping up with the times on the operational front now. As of earlier today, the company is working to expand its InHome delivery service by ditching single-use plastics. In their place, the retail giant is opting for reusable tote bags that it will collect, wash, and repurpose for future deliveries. Sure, at face value, such a move may not seem entirely beneficial for its margins. However, this could serve to help Walmart meet its sustainability goals while making the InHome subscription service more attractive to environmentally conscious consumers.
Aside from this, investors will likely be keeping a watchful eye on Walmart this week ahead of its earnings call before Thursday’s opening bell. For now, Wall Street is expecting the retailer to report an earnings per share of $1.49 on revenue of $150.91 billion. All in all, with all the attention on consumer-facing sectors now, WMT stock could be worth watching. Would you agree?