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Even though the major stock market indices backed away from last week’s new highs, the retail sector kept blasting upward this week. These 4 stocks in that sector continued higher into week’s end even as the big name leaders such as Apple AAPL and Tesla TSLA failed to make it past the previous highs.
Some of these are “specialty” retailers so in those cases it may be that certain characteristics of their business make them shine in the pre-holiday season. Whatever the fundamental reasons may be for their out performance, it may be worth looking more deeply at these new market leaders.
Best Buy BBY ‘s daily price chart:
After heading sideways to down from early May to late September, the action has been almost straight up from the beginning of October. Although the volume is nowhere near heavy, investors seem to have decided that the holiday season will be good for Best Buy. Note that from a price of 104 to a price of 136 is a better than 30% move in just 2 months time. The relative strength indicator (RSI, above the price chart) suggests the buying may have become overdone, at least for now.
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BJ’S Wholesale Club BJ ‘s daily price chart:
The big discount chain will be closed for Thanksgiving for the 15th straight year, according to the company’s October announcement. That hasn’t stopped investors from continued buying of the stock. BJ’s Wholesale Club is on a tear, staying steadily above both the short-term and long-term moving averages with only occasional short dips below the 50-day. After establishing the new high during the Friday trading session, the stock backed off a bit into the close.
The daily price chart of Canada Goose Holdings:
That early November gap up from 40 to 45 came after the company beat the earnings expectations of Wall Street analysts. Investors like it when that happens and, in this case, they really liked it. Note the heavy volume on the day and the follow-up to the new 52-week highs. Canada Goose says the coming quarter looks good as well with increased demand for their parkas coming in from China.
William Sonom WSM a’s daily price chart:
The buyers that swooped in on heavy volume in late August have been proved right. After a couple of months of up and down, the stock this week kept going and closed even higher that that summer time peak. Note that the price remains above an up trending 50-day moving average (the blue line) and well above an up trending 200-day moving average (the red line). Whatever Williams Sonoma is doing lately, it’s definitely working as far as investors are concerned.
The daily price chart of the S&P Retail Index:
This is the index for a wide group of retail stocks showing how the sector is performing as a whole. You can see the similarities to the above individual stocks: a new high this week and above both moving averages. It’s apparent from all of this strength that investors believe we’re just in front of quite a holiday shopping season.
Not investment advice. For educational purposes only. Always consult with a registered investment advisor before making any decisions.