The consumer discretionary sector is a dynamic segment of the stock market. It includes companies producing non-essential goods and services. These are items and services consumers buy with disposable income. The sector covers a broad range, from luxury goods and electronics to restaurants and leisure services.
Investing in consumer discretionary stocks can be a strategic move, particularly in a strong economy. When consumer confidence and spending are high, these stocks often perform well. However, they can be sensitive to economic downturns. Consumer spending typically contracts during economic struggles, affecting these stocks.
Investors should approach this sector with an understanding of economic cycles. It’s essential to research individual companies’ financial health and market position. Diversifying within the sector can also help manage risk. This includes investing across various industries like automotive, apparel, and hospitality. That said, here are two consumer discretionary stocks to watch in the stock market right now.
Consumer Discretionary Stocks To Buy [Or Avoid] Now
- Nike Inc. (NYSE: NKE)
- Lululemon Athletica Inc. (NASDAQ: LULU)
Nike (NKE Stock)
First, Nike Inc. (NKE), is a global leader in athletic footwear, apparel, equipment, and accessories. Nike has grown into one of the most recognizable brands in the sports industry, catering to a wide range of sports including running, basketball, soccer, and more.
At the end of September, Nike reported its Q1 2024 financial results. Diving in, the company notched in better-than-expected results, posting an EPS of $0.94 and revenue of $12.94 billion for Q1 2024. This is versus analysts’ consensus estimates which were an EPS of $0.74, on revenue estimates of $12.10 billion.
Moreover, in the last month of trading, shares of NKE stock have increased by 4.61%. While, during Monday morning’s trading session, Nike stock opened lower on the day so far by 1.56% at $104.45 a share.
[Read More] Best Dow Jones Stocks To Buy Today? 2 In Focus
Lululemon Athletica (LULU Stock)
Next, Lululemon Athletica Inc. (LULU) specializes in high-quality yoga and fitness wear, establishing itself as a premier brand in the athleisure market. Lululemon has expanded its product line to include a variety of athletic wear and accessories, targeting health-conscious consumers and athletes.
Next, at the end of August, Lululemon Athletica announced a beat for its Q2 2023 financial results. Getting straight into it, the company reported earnings of $2.68 per share, on revenue of $2.21 billion. This is against Wall Street’s estimates for the quarter, which were earnings of $2.53 per share, and revenue estimates of $2.17 billion. Additionally, revenue increased by 18.24% compared to the same period, the previous year.
Looking at the last month of trading action, shares of LULU stock have increased by 9.36%. Meanwhile, during Monday’s mid-morning trading session, Lululemon Athletica stock is trading modestly lower by 0.17% at $412.97 a share.
If you enjoyed this article and you’re interested in learning how to trade so you can have the best chance to profit consistently then you need to checkout this YouTube channel. CLICK HERE RIGHT NOW!!
