Are These The Best Consumer Discretionary Stocks To Invest In For 2022?
Consumer discretionary stocks are those that represent companies that produce goods and services that are not considered essential. This includes items like automobiles, apparel, entertainment, and leisure products. While the pandemic has led to a slowdown in spending on discretionary items, many experts believe that there is pent-up demand for these products and services. As a result, consumer discretionary stocks could be poised for a rebound in the coming months.
In particular, analysts believe that the sectors of travel and leisure will be among the most likely to recover. This is evident with consumer discretionary names like Marriott International Inc. (NASDAQ: MAR) and United Airlines Holdings, Inc. (NASDAQ: UAL). Both companies have seen their share price rebound by 4.04% and 15.61% in the last 6 months of trading action. As vaccines become more widely available and travel restrictions are lifted, consumers will likely flock to businesses in these sectors. For investors looking to capitalize on this trend, now may be an opportune time to consider investing in consumer discretionary stocks. With this in mind, here are three top consumer discretionary stocks to check out in the stock market today.
Consumer Discretionary Stocks To Watch Right Now
- Nike Inc. (NYSE: NKE)
- Starbucks Corporation (NASDAQ: SBUX)
- Netflix Inc. (NASDAQ: NFLX)
Nike (NKE Stock)
First up, Nike Inc. (NKE) is an American multinational corporation. In brief, the company engages in the design, development, manufacturing, and worldwide marketing and sales of footwear, apparel, equipment, accessories, and services. For a sense of scale, Nike is the world’s largest supplier of athletic shoes and apparel and a major manufacturer of sports equipment. In August, the company announced its Board Of Directors has declared a quarterly cash dividend of $0.305 per share. Currently, Nike has an annual dividend yield of 1.16%.
Continuing on, just last month the company announced it will release its Q1 2023 earnings on Thursday, September 29, 2022, after the market close. In the meantime, let’s look back at the company’s most recent financial results in June. In detail, Nike reported its fourth quarter and full-year 2022 results. Diving in, for the fourth quarter of 2022 Nike posted earnings of $0.90 per share, on revenue of $12.2 billion. Moreover, the company reported it expects Q1 2023 revenue of approximately $12.23 billion. This is in comparison with Wall Street’s consensus estimates of $12.88 billion in revenue for the first quarter of 2023.
With that, shares of Nike stock are still down over 36% so far in 2022. Furthermore, as of Tuesday morning’s trading session, NKE stock is currently trading at $104.62 per share. Considering all of this, is Nike stock a good buy right now?
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Starbucks (SBUX Stock)
Next, Starbucks Corporation (SBUX) is an American coffee company and coffeehouse chain. Today, the company has more than 34,000 stores worldwide and is the premier roaster and retailer of specialty coffee globally. In the last month, the company has been in the headlines. Specifically, at the beginning of this month, Starbucks named Laxman Narasimhan as the company’s next Chief Executive Officer. Narasimhan will replace long-time CEO Howard Schultz starting October 1st, 2022.
Separate from that, in August Starbucks also recently reported better-than-expected third-quarter fiscal 2022 financial results. In the report, the company posted earnings per share of $0.84, with revenue of $8.2 billion. Compared with, analysts’ consensus estimates for the quarter of $0.77 earnings per share, and revenue estimates of $8.1 billion. Moreover, Starbucks notched in an 8.7% increase in revenue during the same period, a year prior.
Additionally, Starbucks CFO Rachel Ruggeri commented in their letter to shareholders, “We delivered record-breaking revenue performance during the quarter from continued strength in customer demand globally, balanced with our ability to execute investments despite macroeconomic and operational headwinds. Our commitment to deliver shareholder value has not wavered, and we are making the right decisions and investments today for the future of Starbucks.” Currently, SBUX stock has an annual dividend yield of 2.40%. Meanwhile, year-to-date shares of Starbucks stock are down over 29%, and they currently trade at $81.94 as of Tuesday morning. With this in mind, is now a good time to buy Starbucks stock at these price levels?
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Netflix (NFLX Stock)
Lastly, Netflix Inc. (NFLX) is an American media-services provider and production company. For starters, Netflix is a streaming service that offers a wide variety of award-winning TV shows, movies, anime, documentaries, and more on thousands of internet-connected devices. You can watch as much as you want, whenever you want without a single commercial and all for one monthly price. For a sense of scale, Netflix currently has over 200 million paid subscriptions across 190 countries globally.
Back in July, the company announced a beat for its second quarter 2022 financial results. Diving in, Netflix reported earnings of $3.20 per share, along with revenue of $7.97 billion in the second quarter. For context, wall street analysts’ consensus estimates for the quarter were earnings of $2.95 per share and revenue of $8.03 billion. What’s more, these figures signify an 8% jump in earnings during the same period, in 2021. Additionally, sales also increased by 9% for Q2 2022. Though, the company did report a loss of 970,000 subscribers for the quarter. These numbers actually came in under estimates of a loss of 2 million subsribers for the second quarter. Netflix reported that this is because of increased competition in the marketplace, and price increases.
Year-to-date shares of NFLX have been beaten down by over 63% after opening Tuesday’s trading session at $215.69 per share. All in all, do you think NFLX stock is a good investment for your long-term portfolio at its current market valuation?
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