U.S. equities are pushing higher on Thursday, keeping the S&P 500 over critical support near the 2,800 level. While interest rates remain in focus, with weakness on the long end of the Treasury yield curve, stocks seem to be strengthening on President Donald Trump’s tailwinds this week (Russia probe wrapping up, pressure on OPEC to lower oil prices) as well as ongoing dovishness from the major central banks.
Some strength in the U.S. dollar is helping U.S. equities as well, attracting foreign inflows chasing currency carry trades.
As a result, a number of stocks in the consumer sector are perking up. While the economic data has been soft lately, the job market remains red hot. And that is driving expectations of an ongoing surge in retail spending.
Here are four stocks in the area worth a look:
Retail Stocks to Watch: Lululemon (LULU)
Shares of Lululemon (NASDAQ:LULU) are surging higher — up more than 15% as I write this — thanks to the reporting of better-than-expected results after the close on Wednesday. Earnings of $1.85 beat estimates by 10 cents on $1.2 billion in revenue. Forward guidance was strong as well on confidence in its online business.
The company will next report results on June 26 after the close. Analysts at Canaccord raised their price target on a belief that positive catalysts, including product mix and consumer engagement, will continue.
Bed Bath & Beyond (BBBY)
Bed Bath & Beyond (NASDAQ:BBBY) stock is rising up and over its late February highs, definitively moving away from its 200-day moving average to return to levels not seen since September. The move could well mark the end of a downtrend going all the way back to early 2015 that saw shares fall from a high near $74 to a low of around $10.35 late last year — a loss of nearly 90%.
The company will next report results on April 10 after the close. Analysts are looking for earnings of $1.10 per share on revenues of $3.3 billion. When the company last reported on Jan. 9, earnings of 18 cents per share beat estimates by a penny on a 2.6% rise in revenues. Analysts at Telsey Advisory Group recently raised their price target on expectations of management changes.
American Eagle Outfitters (AEO)
Shares of American Eagle Outfitters (NYSE:AEO) are challenging their 200-day moving average, setting up a breakout from its post-November consolidation range. The company has enjoyed steady success in the notoriously finicky teen retail segment, posting 16 consecutive quarters of positive comp-store sales growth.
The company will next report results on May 30 after the close. Analysts are looking for earnings of 21 cents per share on revenues of $855 million. When the company last reported on March 6, earnings of 43 cents per share beat estimates by a penny on a 1.2% rise in revenues.
Kohl’s (NYSE:KSS) shares are attempting another breakout above their 200-day moving average, challenging resistance from a five-month consolidation range and setting up a run at the high set in November. The stock was recently upgraded by analysts at Atlantic Equities thanks to new initiatives like a partnership with Planet Fitness (NYSE:PLNT).
The company will next report results on May 21 before the bell. Analysts are looking for earnings of 70 cents per share on revenues of nearly $4 billion. When the company last reported on March 5, earnings of $2.24 beat estimates by six cents on a 3.4% drop in revenues.
As of this writing, William Roth did not hold a position in any of the aforementioned securities.