Will The Trend Continue For These Retail Stocks In September 2020?
Many investors find retail stocks attractive. That’s because they can have a stake in a business where they shop every day. Just because you like shopping at a particular hypermarket or department store doesn’t make them a good investment. We all know the coronavirus pandemic has wreaked havoc in many businesses. And brick-and-mortar retail shops are hit hardest when the stay-at-home measures were implemented.
With some of the major retailers such as Ascena Retail Group (ASNAQ Stock Report) and J.C. Penney (JCPNQ Stock Report) seeking bankruptcy protection, it sure seems like there is not much reason to look at this area. But the truth is, not every retail stock is faring badly. On the contrary, even under duress, some retail stocks are thriving. They are dealing with the changes. And they are gearing up for economic recovery. It could be just me, but it increasingly appears that the worst of the coronavirus pandemic is over. Should the economy really reopen and rebound in the following few quarters, we can expect consumer confidence to slowly return. And beaten-up retail stocks could possibly bounce back stronger and are here to stay.
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Top Retail Stocks To Buy [Or Sell] In September 2020: Costco Wholesale Corp.
Wholesale giant Costco (COST Stock Report) has done better than most other retailers during the pandemic. Costco avoided the reliance on clothing also makes it a more superior retail stock to buy amid contracting demand this year. The company’s vast offerings at very competitive prices made it a one-stop-shop for many during the toughest parts of the lockdown.
Prior to the release of August sales results, investors have been bidding for COST stocks. That’s in anticipation of a stellar performance by the wholesale giant. Investors were right, and the company reported net sales of $13.56 billion for the retail month of August.
The four weeks ended August 30, 2020, saw an increase of 15% from $11.79 billion last year. With social distancing measures and limited outings expected in the near term, Costco could continue to be an appealing shopping destination for a large audience of customers.
Top Retail Stocks To Buy [Or Sell] In September 2020: Walmart
It is impossible to have a list of retail stocks to buy that doesn’t include Walmart (WMT Stock Report). The largest retailer company in the world posted its biggest earnings in 31 years last month. That may not have been surprising as consumers were spending their stimulus checks. The company leverages its physical stores and its e-commerce initiatives to deliver goods to customers during the pandemic.
Recently, the company unveiled a subscription service that aims to compete with Amazon (AMZN Stock Report). The $98-a-year Walmart+ membership plan includes free shipping on items $35 and over. And it includes same-day deliveries on certain items from stores, such as groceries.
Although Walmart’s new subscription service is $21 lower than Amazon, it lacks many of its rival’s benefits. For instance, Amazon Prime requires no minimum purchase for free deliveries. And Prime includes a number of perks such as free music and video streaming. It sure looks like Walmart has some catching up to do. But if we are to focus on delivery speeds only, Walmart beat Amazon in many areas.
Top Retail Stocks To Buy [Or Sell] In September 2020: Target
Shares of Target (TGT Stock Report) have climbed nearly 20% year-to-date. This came after the company reported a monster quarter that has beaten every analyst’s expectations. Sales online and at stores open for at least a year climbed by 24.3% during the quarter ended August 1. The explosive demand from its digital channel is also the reason why investors appear to be optimistic about the retailer’s growth prospects.
Also, the company recently announced that it will be adding hundreds of new items to its Good & Gather line that’s exclusive to the company. This comes as the coronavirus pandemic has caused grocery chains, including Target, to shift their focus to online shopping.
After all, more Americans are now purchasing their food from behind their computer screens. As a result, online consumption has also been working in Target’s favor lately. We can see this in the growth in digital same-store sales of 195% in its latest quarter