This story was originally published here.
One of my favorite retail data platforms, Placer.ai, recently released a new report that had one crystal clear investment implication: it’s time to look for beaten-up apparel stocks to buy.
Apparel stocks have fallen off a cliff over the past three months. Ever since the novel coronavirus pandemic swept across America, apparel companies have been forced to close their stores, and consumer spending on discretionary items (like clothes) has tanked. In April, consumer spending at clothing stores dropped 90% year-over-year — its biggest drop, ever, by a mile.
But new Placer.ai data shows that a consumer discretionary spending recovery is underway. Specifically, Placer.ai found that foot traffic at apparel stores across America has grown for five straight weeks, with the two most recent weeks in May showing 100%-plus week-over-week growth.
This data isn’t isolated. It’s corroborated by a bunch of other data. The number of Americans that categorized themselves as “extremely worried” about Covid-19 has dropped from 28% in late March, to 23% in late May, according to a Statista survey. Consumer confidence levels have already bottomed. Beaches and restaurants were very crowded Memorial Day weekend. Malls have reported strong early reopening traffic trends.
In other words, there is an overwhelming amount data that support one simple conclusion: the economic recovery, and by extension the consumer spending recovery, is finally here.
As consumer spending trends gradually recover over the next few months, beaten-up apparel stocks will bounce back. By a bunch, since they dropped by a whole lot in March/April. With that in mind, here are seven of the best apparel stocks to buy as consumer spending recovers:
Apparel Stocks to Buy: Urban Outfitters (URBN)
I like Urban Outfitters as one of the top apparel stocks to buy over the next few months for two reasons.
First, this is a best-in-breed apparel retailer. Sales have grown by more than 75% since 2010 — a remarkable and largely unparalleled feat for a mall-based physical apparel retailer. Brand popularity is sky-high, with Piper Jaffray’s Taking Stock with Teens Survey consistently rating Urban Outfitters as one of the most popular shopping destinations for young consumers. And the company has truly embraced the e-commerce revolution, transforming into one of the most formidable omni-channel retailers in the world.
Second, Urban Outfitters targets the 18 to 28 year-old demographic. That demographic is the least at-risk to the coronavirus pandemic. They are also the ones more anxious to get back out into the world and spend money. As such, the first wave of the consumer spending recovery will likely be driven by young consumers. That’s good news for Urban Outfitters.
Bottom line, thanks to its demographic positioning and strong brand, Urban Outfitters is one of the best apparel stocks to buy now.
Editor's Note: Click here for the rest of the apparel stocks.
65 Ways You Can Make Extra Cash in This Crazy Environment
With the market crisis moving into our rearview mirror, folks are now looking for ways to get back to making money.
Neil George wants to show you how to get his new book that profiles 65 simple ways to earn large amounts of work-free income.
…extra cash that you can collect ON TOP of your Social Security check…
…without messing around with crappy jobs. (Pizza delivery driver? No way.)
These are PROVEN cash-gushing strategies… the kind typically used by the wealthy elite.
And the best part is…
Neil George has set aside copies of his book, Income for Life, and he’s willing to send you a hardback version today ABSOLUTELY FREE (just pay shipping). This may be the last time we offer this.
(Just 517 copies left, so click here to claim yours before it's ripped away.)
Here's just a sample of what you can find inside:
- Use what Neil calls the “FHA Loophole” to get the government to pay your mortgage — PLUS receive hundreds in extra cash on top.(Page 217)
- Collect $100s for pictures in old family photo albums! Believe it or not, there is an easy way to turn your old artwork/photographs into $100 bills (certain businesses are desperate). (Page 297)
- Get paid every time your favorite song gets played on the radio! This little-known website allows you to tap into royalty payments every time your favorite song is played on the radio. Some lucky folks collect thousands of dollars a year! (Page 307)
- Pocket upwards of $197 PER HOUR simply by taking a walk through the woods in the fall… or $137 while visiting your favorite beach in the summer… and many, many more!
This book is flying off the shelves and this may be the last run of copies we print.
So if you don't claim your copy of Income for Life today, we'll send it to the person behind you in line…
