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Are These Top Consumer Discretionary Stocks Worth Watching Right Now?
As the stock market continues to bounce back from last week’s rough selloffs, investors appear to have plenty of options. One of those options now could be consumer discretionary stocks. This would be the case given that there are still consumers who are receiving their stimulus checks now. Moreover, given the overall improving pandemic conditions in the nation, discretionary spending would be on the rise as well. Naturally, consumers could feel more comfortable spending their saved-up pandemic funds in the months to come. For investors, the challenge would be deciding between trading pandemic winners or reopening trade hopefuls now. If anything, consumer discretionary stocks are present across the board in this case.
On one hand, consumer tech companies such as Microsoft (NASDAQ: MSFT) have and continue to innovate at breakneck speeds. Later this week, Microsoft will be unveiling the latest iteration of its flagship operating system. On the other hand, reopening plays such as Crocs (NASDAQ: CROX) and Camping World Holdings (NYSE: CWH) are flourishing now. With more people leaving their houses, demand for both companies’ wares would increase. As it stands, both CROX stock and CWH stock are looking at massive gains of over 750% since their pandemic era lows. Evidently, there is no shortage of excitement in the consumer discretionary industry now. Should you be looking to add some to your portfolio, here are four trending names in the stock market today.
Top Consumer Discretionary Stocks To Watch
Peloton Interactive Inc.
Peloton is a consumer discretionary company that focuses on exercise equipment and interactive media. The company’s leading interactive fitness platform is used by millions of members around the world. In essence, it has pioneered connected, technology-enabled fitness and the streaming of immersive instructor-led classes for its members. PTON stock currently trades at $117.48 as of 1:45 p.m. ET and has been up by over 110% in the last year.
Yesterday, the company was reported by Bloomberg to be planning to enter the wearables market. This would include the acquisition of Atlas Wearables earlier this year and other companies. The company also announced on Tuesday that it will work with companies to offer their employees reduced-price or free subscriptions to its workout app through the Peloton Corporate Wellness program. Businesses and organizations operating in the U.S., U.K., Canada, and Germany are among the countries that will be able to join in this program. Also, in late May, the company announced that it will be building its first U.S. factory. The factory will be dedicated to producing Peloton’s award-winning Peloton Bike, Bike+, and Peloton Tread starting in 2023. For these reasons, will you consider buying PTON stock?
Walt Disney Company
Disney is a diversified multinational mass media and entertainment conglomerate that is headquartered in Burbank, California. The company has become a household name over the decades for its universally acclaimed theme parks and also animation studios. Disney has invested significantly into its streaming business in the last year and has given companies like Netflix (NASDAQ: NFLX) a run for its money. DIS stock currently trades at $175.22 as of 1:45 p.m. ET and has been up by over 45% in the last year.
Last month, the company reported its second-quarter financials for fiscal 2021. In it, the company posted revenue of $15.61 billion for the quarter. It also reported a net income from continuing operations of $912 million, up by over 95% compared to a year ago. The company says that it is pleased to see encouraging signs of recovery across its business segments. It also remains focused on ramping up operations while fueling long-term growth for the company. As it continues to reopen its theme parks and resorts, while also ramping up productions at its studios, is DIS stock worth buying right now?
Nike is a consumer discretionary stock that focuses on athletic footwear and apparel. It is an industry-leading designer and is one of the most valuable brands among sports businesses. It employs over 75,000 people worldwide and markets its products under its own brand and subsidiaries like Jordan Brand and Converse. NKE stock currently trades at $133.10 as of 1:46 p.m. ET. The company will announce its fourth-quarter fiscal 2021 results on Thursday after the market closes.
How has the company been doing financially ahead of its next earnings? Based on its third-quarter financials, it reported a revenue of $10.4 billion. Its Nike Direct sales were $4 billion and its Nike brand digital sales increased by 59%. Nike also posted diluted earnings per share of $0.90. The company says that its strong quarter is due to its competitive advantages. Besides, Nike continues to accelerate innovation and create a premium marketplace of the future. With such impressive financials, is NKE stock worth buying?
Sally Beauty Holdings Inc.
Another consumer discretionary player to know now would be Sally Beauty Holdings Inc. (SBH). For some context, SBH is a Texas-based international specialty retailer. As the name suggests, the company is in the business of marketing beauty supplies. In terms of scale, SBH operates via a network of 5,000 stores that collectively offer about 8,000 products. The likes of which range from hair coloring and care to skincare and nail-based wares. With more consumers looking to venture out of their homes again, SBH’s cosmetic offerings would be in demand. Similarly, investors appear keen on SBH stock which is looking at year-to-date gains of over 70%. Now, the company’s shares are trading at $22.01 as of 1:46 p.m. ET. Would it be wise for others to follow suit?
For one thing, analysts from investment firms Cowen (NASDAQ: COWN) and Oppenheimer (NYSE: OPY) seem to believe so. Yesterday, SBH stock was hit with an Outperform rating by analysts from both firms. As a result, the company’s shares surged by over 13% during intraday trading. Firstly, Cowen analyst Oliver Chen believes that SBH is “emerging from the pandemic as a stronger retailer through enhanced digital offerings, improving store experience on rehabs, and strategic store closures.” Supporting that, Oppenheimer analyst Rupesh Parikh argues that SBH has “sustainable earnings power“. With the eventual surge in hair and salon trends as the economy reopens, I would be inclined to agree. All things considered, will you be adding SBH stock to your portfolio?