Should You Consider Adding These Top Retail Stocks To Your Portfolio Right Now?
For investors, retail stocks could be the next up-and-coming stocks to watch on the stock market now. Why? Well, on one hand, conventional retail players would stand to benefit from the economy reopening. This would be the case as brick-and-mortar stores would see increased foot traffic post-pandemic. On the other hand, digital retail companies could also continue to flourish as consumers turn to e-commerce out of convenience. Not to mention, the retail industry overall is currently benefiting from the recent $1.9 trillion U.S. stimulus package. Evidently, the Commerce Department announced solid retail sales figures in March. Retail sales soared by 9.8%, the largest monthly rise since May 2020. All this is great, but can top retail stocks maintain this momentum moving forward?
Well, JPMorgan (NYSE: JPM) CEO Jamie Dimon appears to believe so. Just yesterday, Dimon said in the bank’s earnings release that overall hype around the end of the pandemic could spell “extremely robust, multi-year growth” for the economy. Even now, some of the top retail stocks continue to perform. For example, Etsy (NASDAQ: ETSY) and L’Brands (NYSE: LB) are looking at gains of over 260% in the past year. If all this has you keen on retail stocks now, here are four trending names on the stock market today.
Top Retail Stocks To Watch In April 2021.
- GameStop Corp. (NYSE: GME)
- Amazon.com Inc. (NASDAQ: AMZN)
- Costco Wholesale Corporation (NASDAQ: COST)
- Target Corporation (NYSE: TGT)
GameStop Corp.
GameStop is a video game, gaming merchandise, and consumer electronics retailer that has been hot on the news recently. The company is a Fortune 500 company that is headquartered in Texas and is a leading specialty retailer. GME stock has been the target of retail traders since the start of 2021 and the company has enjoyed staggering gains of over 1,500% in January when it peaked. It has since taken a breather but is still up by over 700% year-to-date. GME stock also currently trades at $158.53 as of 1:33 p.m. ET.
Last month, the company reported its fourth quarter and fiscal 2020 financial results. In it, the company posted net sales of $2.122 billion for the quarter. Global e-commerce sales increased by 175% and represented 34% of net sales for the quarter. This is certainly in line with the company’s recent strategy to shift towards more e-commerce rather than relying completely on its brick-and-mortar stores.
The company also strengthened its balance sheet and ended fiscal 2020 with $635 million in cash. This would set the foundation for its ongoing transformation. Given the excitement surrounding the company’s developments, will you consider buying GME stock?
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Amazon.com Inc.
Amazon is a retail giant that is based in Washington which focuses on e-commerce retailing. The company is one of the most valuable brands in the world. It is also one of the largest online marketplaces by revenue and market capitalization. The company’s strength lies in its e-commerce platform and has been one of the biggest winners to come out of this pandemic. AMZN stock currently trades at $3,371.03 as of 1:29 p.m. ET.
In February, the company posted its fourth-quarter financials. In it, Amazon posted net sales of $125.6 billion, a 44% increase year-over-year. It also ended the year with $31 billion in cash. Net income for the quarter increased by an impressive 118% to $7.2 billion.
“Amazon is what it is because of invention. We do crazy things together and then make them normal. We pioneered customer reviews, 1-Click, personalized recommendations, Prime’s insanely-fast shipping, Just Walk Out shopping, the Climate Pledge, Kindle, Alexa, marketplace, infrastructure cloud computing, Career Choice, and much more,” said Jeff Bezos, Amazon founder, and CEO. All things considered, will you add AMZN stock into your portfolio?
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Costco Wholesale Corporation
Costco is a multinational retailer that operates a chain of membership-only big box retail stores. As of 2020, Costco is the fifth largest retailer in the world. It also ranks No. 10 on the Fortune 500 rankings of the largest U.S. corporations by total revenue. It operates 808 warehouses across the globe and also has a commendable e-commerce site. COST stock currently trades at $369.18 as of 1:29 p.m. ET. Yesterday, the company announced that it has increased its quarterly cash dividend to $0.79 per share.
Last week, the company reported its March sales results. In detail, Costco reported that net sales for the month of March were $18.21 billion. 57.7% of its comparable sales came from its e-commerce segment. The company has consistently produced higher annual same-store sales over the years.
Costco also has a good long-term strategy. Firstly, Costco is discounting the wage premium that it paid workers during the pandemic. While it is permanently raising wages, this could still result in hundreds of millions of annual savings compared to the last year. Secondly, management has been increasing sales and profitability over the long term as well. Given all of this, will you consider COST stock as a top retail stock to buy?
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Target Corporation
Last but definitely not least, we have retail giant Target. In brief, the company serves consumers out of nearly 1,900 stores across the nation. Similar to most of its peers in the retail business, Target continues to rely heavily on its online services. Notably, the company’s digital sales revenue increased by nearly $10 billion in 2020. According to Target, this is thanks to a 235% year-over-year surge in its same-day services revenue. As one of the largest retailers in the U.S. now, Target would be another go-to for investors looking to bet on the retail industry. In fact, TGT stock is looking at gains of over 90% in the past year and currently trades at $204.46 as of 1:28 p.m. ET.
Despite the roaring success of its pandemic-friendly services, Target does not seem to be resting on its laurels yet. Earlier today, COO John Mulligan revealed plans to expand and optimize the company’s current delivery network this year. Diving right into it, Target is currently testing new ways to deliver online orders in Minneapolis. This is being done with the help of special sorting facilities and three key logistic companies it acquired previously.
In short, all this allows Target further trim delivery times, helping it compete with larger rivals. Whether this helps with TGT stock’s long-term growth potential or not remains to be seen. All in all, would you consider investing in TGT stock right now?
