The Christmas season can be a time that makes or breaks a retailer's entire year. With that being said, most investors already know this information. It's not typical for a retailer's stock to experience a major pop or drop around the holiday season just because of revenue and earnings were three times that of the previous quarter.
But most reports currently indicate the American Consumer is healthy and feeling good. Which would indicate this holiday shopping season could be a record-setting year regarding the amount of money spent buying holiday presents. And a record-setting year is the type of event that would make a retailer’s stock pop. A large year-over-year revenue and earnings beat is the type of performance that Wall Street likes and rewards with a higher share price.
One report, in particular, the University of Michigan Consumer Sentiment Index was unchanged in November and remained higher thus far in 2018, at a 98.4, then in any prior year since 2000. Furthermore, the report indicates "income expectations have improved, and consumers anticipate continued robust growth in employment." "The renewed strength in nominal income expectations is critical to overall spending prospects. Among the working age population, those between the ages of 25 and 54, the anticipated annual gain in nominal household income was 3.6% in November, the best in the past decade" per the November report.
If the University of Michigan Consumer Sentiment Index is correct, we could be in for some really big number this holiday season. That being said, to fully realize the share price increase, it is best to buy the retailers before early holiday shopping reports are released. Obviously, by doing so, you take the risk of this year being an average or poor shopping season, but if you’re willing to take that risk, it could pay off nicely this year.
So, let's take a look at a few of the Exchange Traded Funds that you could purchase if you want to attempt to ride the retail waved this holiday season. Continue reading "Treat Yourself To An Early Christmas Gift"