Retailers are adapting their business models as technology changes how people shop. Still, secular trends are working against their favor as e-commerce continues to take share from brick and mortars.
This puts retail stocks in a tough spot, and over the past six months, the industry has pulled back by 14%. This performance was worse than the S&P 500’s 5.8% fall.
Market swings can be tough to stomach, and volatile stocks often experience exaggerated moves in both directions.
While many thrive during risk-on environments, many also struggle to maintain investor confidence when the ride gets bumpy.
Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.
Just because a business is in the green today doesn’t mean it will thrive tomorrow.
The retail industry is juggling shifting consumer behaviors, stiff competition, and evolving tariff policies that are expected to influence the sector’s trajectory. Yet, here are 4 stocks in the space to keep an eye on despite the challenges.
A number of stocks fell in the afternoon session after President Trump criticized the Federal Reserve's approach to interest rate cuts, warning that the pace was slow and could hinder economic growth. Trump's comments added pressure to an already sensitive market, raising concerns about political interference in monetary policy.
Large-cap stocks had poor performance last week, including UnitedHealth Group, Global Payments, Applovin, Humana, DaVita, Meta Platforms, Yum China, CoreWeave, Burlington Stores, Super Micro Computer, and GlobalFoundries.
Retail sector momentum is building as some global brands show improving visibility, while diversified specialty retailers benefit from operational gains and product mix strength.
Telsey Advisory Group analyst Dana Telsey reiterated an Outperform rating for Burlington Stores with a $340 price target. Despite a slower start to FY25 due to unseasonal weather and delayed tax refunds, BURL is expected to see sales improvement in the second half, driven by 100 new store openings and anticipated margin growth.
