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Posted on 24 November 2011 | 10,392 views

Black Friday Special Deals Stock List

Black Friday is quickly approaching, so it is time to look at companies that could benefit from the shopping mania taking place that day. Traditionally, technology and fashion retailers have attracted the largest numbers of customers, and based on the expectations, this year will not be any different.

It’s the most wonderful time of the year, but for retailers, this is the most critical time of the year. Thanksgiving is Thursday and that means after Americans recover from their turkey and pumpkin pie, they’ll head to malls and shopping centers in droves on Black Friday.

Here is a list of interesting companies that could get a positive or negative effect from Black Friday sales that could carry on through the rest of the holiday season and the remainder of the fourth quarter.

Dollar Tree (Stock Symbol: DLTR) doesn’t fit in with the other four upscale stores, but it does fit right into the New Frugal investment strategy. Dollar Tree is the best super discount store, and it is expanding fast and intelligently — adding groceries and other must-have items. DLTR caters to the poor and lower-income household consumers who shop day to day and week to week. Also, since it is small compared to Wal-Mart (Stock Symbol: WMT), Dollar Tree’s discounts from suppliers are increasing as its volume increases, giving it solid margins that are not shrinking as fast as others.

The super-deep discounters have huge cost advantages over traditional discount stores — meaning Dollar Tree actually can under-price Wal-Mart on some items.

J.C. Penney (Stock Symbol: JCP) is lagging behind department store rivals like Macy’s (Stock Symbol: M) and Kohl’s (Stock Symbol: KSS).

The company, which is very much in a transitory stage, swung to a loss in the third quarter and provided a fourth-quarter outlook that fell short of Wall Street forecasts.

J.C. Penney is betting on its new CEO Ron Johnson, the man credited with the success of Apple’s (Stock Symbol: AAPL) retail stores. Since taking the post on Nov. 1, Johnson has started to revamp the management team, hiring two former Apple colleagues to fill the chief talent officer and chief operating officer roles.

The department store has been attempting to revitalize its stale image, including brands like MNG by Mango and Sephora and purchasing the Liz Claiborne (Stock Symbol: LIZ) brand, but it may be too late for any monumental changes to be evident this Christmas, said Craig Johnson, president at Customer Growth Partners, even with new management.

Upscale apparel retailer Nordstrom, Inc. (Stock Symbol: JWN) also has been very flexible in changing the product mix to cater to the New Frugal customer. People with less money to spend that still have some money to spend want quality and great service. They get that in Nordstrom stores.

And now Nordstrom is taking share from other department stores and will continue to do so for the foreseeable future — a growth story in a 2% growth industry. If we see the broader market stabilize soon, JWN shares will look like a big bargain here under $38 — especially if the holiday sales are robust.

Best Buy (Stock Symbol: BBY) has seen its market share fall as online retailers like Amazon.com have increased their popularity. However, on Black Friday, consumers tend to go where the lines are the longest to hunt for the best technology bargains. This tendency might set a positive tone for the rest of the quarter, if Best Buy can successfully remind its customers of the benefits of shopping at a brick and mortar store and being assisted by real salespeople.

The Gap (Stock Symbol: GPS): Last week, Gap reported the latest in a growing line of earnings disappointments. Revenue fell 2% in the third quarter and a comp of -5 isn’t acceptable. Those aren’t our words. Gap CEO Glenn Murphy said that. Shares of California-based Gap are down almost 16% year-to-date and the carnage may not stop as rising input costs have hurt apparel retailers of all stripes.

Gap couldn’t break through resistance at $20 and the stock has downside risk to support at $17. If that doesn’t hold and Black Friday is bad for the Gap, the only options are to avoid the stock or be short.

This well-known teen fashion retailer is down almost 30% in the last 30 days after missing the Q3 earnings and revenue estimates. Strong Black Friday sales could provide Abercrombie & Fitch (Stock Symbol: ANF) with an opportunity to finish Q4 strongly. This is highly dependent on consumers, however. The super committee deadline and European debt crisis have increased uncertainty in the macro environment, which might push consumers towards more lower-end retailers.

Apple‘s (Stock Symbol: AAPL) sales doubled during our very own Great Recession thanks to the iPhone, which essentially was the sale of a $300 phone with a two-year contract — during a time when many competitive phones were free with a two-year contract. This flight to quality is going to accelerate this holiday spending season, beginning with Black Friday.

The following five companies embody this New Frugal. You will notice that they are selling goods that are supposedly too expensive to buy during a Great Recession, yet they have, on average, seen their stock price more than quadruple in the past three years.

Kohl’s (Stock Symbol: KSS) reported Q3 EPS of $0.80 versus $0.78 estimates and revenues of $4.38 billion versus $4.40 billion estimates. The revenue miss is a good indicator that middle-class in the United States has seen its purchasing power diminish, which has hurt retailers targeting this consumer segment. The recent job data has been somewhat promising, but it is unclear whether it will help the consumers boost their spending. Thus, Kohl’s Black Friday sales numbers can be an important indicator of the current state of confidence among middle-class consumers.

Lowe’s (Stock Symbol: LOW): The second-largest home improvement retailer has had its share of struggles this year and hey, Jimmie Johnson didn’t win a sixth consecutive Nascar title. That’s not the reason for the slack performance in Lowe’s. The stock really has played second fiddle to larger rival Home Depot (NYSE: HD) this year. Home Depot is up more than 7% year-to-date while Lowe’s is off roughly 7%.

After a nice October rally,  Lowe’s chart is weakening and the stock is starting to correct an overbought condition. It may be OK to be bullish on the consumer, but it’s still too early to be bullish on the housing market.

Amazon’s (Stock Symbol: AMZN) Black Friday sales numbers are interesting to watch, as they indicate whether the consumers are getting fed up with queuing up to the online environment also on a day when the brick and mortar retailers have traditionally seen the greatest customer flows. Additionally, Amazon’s Kindle Fire sales numbers between Cyber Monday and Black Friday are another area of focus, as they may illustrate how successfully the company has entered the tablet market.

Those little blue packages at Tiffany & Company (Stock Symbol: TIF) have been a favorite for years. Tiffany’s brand is unique in the retail marketplace as this high-end retailer has seen its business survive and even thrive through the recession and continue to show increasing sales performance.

Tiffany’s stock price has pleased investors, climbing 54% in the last year. It continues to be rated a “strong buy” by many analysts and research pros. You’ll never go wrong at the holidays with a “little blue box” from Tiffany’s.

Sears Holding (Stock Symbol: SHLD): An extremely disappointing earnings report from Sears last week aside, think about this stock this way: Has anyone even mentioned to you lately that they’ve been shopping at Sears or Kmart? Maybe the Kardashian’s attempt at fashion will prove fruitful for Sears this holiday season, but there’s still the matter of Kmart getting its lunch handed to it by Target (Stock Symbol:  TGT) and Wal-Mart (Stock Symbol: WMT).

The company rolled the dice and, just as the Great Recession rolled over the U.S., Coach (Stock Symbol: COH) rolled out a new, less expensive product line that still was expensive. It worked — growth has been terrific and the company has been particularly successful in Asia, with double-digit growth from that part of the world.

The holiday season always has been kind to COH, and Coach’s sales and earnings will continue to beat expectations — Wall Street likes growth and is willing to pay for it.

American Eagle Outfitters (Stock Symbol: AEO): With all the problems the Gap is experiencing and the plunging shares of Abercrombie & Fitch (Stock Symbol: ANF), it’s hard to endorse American Eagle as a wise Black Friday play. In all fairness, it’s not the worst of the retail lot, but it’s not the best either. This stock would be very vulnerable to accelerated selling if support at $13 is violated.

That little man on the horse is one of world’s most recognizable brands — and for many, a symbol of status. For others, it is a symbol of quality. And for investors, it should represent superb management and a mixed product line that appeals to people in most income classes. The bottom line for Ralph Lauren (Stock Symbol: RL) is that the brand is many years away from market saturation and RL will continue to be a growth stock.

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