Per Retail Metrics, total September same-store sales for apparel retailers came in at 7.9%, up from 7.8% from the year-ago period and compares with a 6.2% and 7.5% increase in August and July, respectively. It goes without saying that the apparel industry is on firm ground. September is considered the late back-to-school season. The late back-to-school selling was one of the major factors behind giving apparel sales a boost.
Apparel stocks have been doing well for a while now and the recent jump proves that consumers are willing to spend more on apparels and shoes. Also, United States’ economic performance has been a key to the impressive show put up by the apparel industry. Moreover, higher wages, robust business and consumer confidence have provided a strong tailwind for the industry.
Apparel Industry Likely to Perform Well
The apparel industry is likely to put up an impressive show in the near term with the holiday season approaching. The holiday season is typically one of the best times for retailers, which sees a jump in sales. According to the National Retail Federation (NRF), holiday retail sales are projected to increase significantly this year and reach around $721 billion in the November-December period.
Per the NRF, holiday retail sales registered its best increase in 2017 since the Great Recession. In 2017, retail sales during the last two months of the year climbed 5.5% to reach $691.9 billion. This clearly indicates that the apparel industry has been steadily growing.
Moreover, retailers are set to hire a record number of workers for the upcoming holiday season. Per the NRF, American retailers are expected to hire between 585,000 and 650,000 workers for the November-December holiday period, higher than 582,500 in 2017.
Understandably, apparel industry has been performing well for a while now and is on solid ground. Further, with robust consumer confidence, higher wages, and record low unemployment, an increasing number of Americans are willing to spend more. And with the holiday season approaching, which is considered one of the best times for retailers, apparel stocks are poised to perform well in the near term.
This is why picking apparel stocks still looks like a smart option. However, picking winning stocks may be difficult. We have narrowed down our search to the following stocks based on a good Zacks Rank and other relevant metrics.
Tilly’s, Inc. (TLYS – Free Report) is a specialty retailer in the action sports industry selling clothing, shoes and accessories.
Tilly’s sports a Zacks Rank #1 (Strong Buy). The company has expected earnings growth of 38.5% for the current year. The Zacks Consensus Estimate for the current year has improved by 11.1% over the last 60 days.
Shoe Carnival, Inc. (SCVL – Free Report) is one of the nation’s largest family footwear retailers, offering a broad assortment of moderately priced dress, casual and athletic footwear for men, women and children with emphasis on national and regional name brands.
The company has expected earnings growth of 45% for the current year. The Zacks Consensus Estimate for the current year has improved by 6.4% over the last 60 days. The stock sports a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Urban Outfitters, Inc. (URBN – Free Report) is an innovative specialty retailer and wholesaler which offers a variety of lifestyle merchandise.
Urban Outfitterscarries a Zacks Rank #1. The company has expected earnings growth of 59.3% for the current year. The Zacks Consensus Estimate for the current year has improved by 6% over the last 60 days.
DSW Inc. (DSW – Free Report) is a leading branded footwear and accessories retailer that offers a wide selection of brand name and designer dress, casual and athletic footwear and accessories for women, men and kids.
DSW Inc sports a Zacks Rank #1. The company has expected earnings growth of 13.8% for the current year. The Zacks Consensus Estimate for the current year has improved by 6.8% over the last 60 days.
Express, Inc. (EXPR – Free Report) is a specialty retailer of women’s and men’s apparel in the United States. The Company operates retail outlets in high-traffic shopping malls, lifestyle centers and street locations across the United States.
Express, Inchas a Zacks Rank #2 (Buy). The company has expected earnings growth of 27.8% for the current year. The Zacks Consensus Estimate for the current year has improved by 9.5% over the last 60 days.
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