15 Best Consumer Discretionary Stocks to Buy Now

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In this article we will take a look at the 15 best consumer discretionary stocks to buy now. You can skip our detailed analysis of the consumer discretionary industry’s outlook for 2021, and go directly to the 5 Best Consumer Discretionary Stocks to Buy Now.

Consumer discretionary businesses sell items that are non-essential yet desirable for consumers. These include sports equipment, entertainment, luxury goods, home furnishing, automobiles, etc. Consumer discretionary stocks thrive during the period of economic stability. With the higher rate of employment, people tend to spend more leisurely.

Though 2020 was the year of economic uncertainties, the consumer discretionary sector, as a whole, managed to stand its ground. Consumer Discretionary Select Sector SPDR Fund (NYSE: XLY) has delivered a return of 34.03% to shareholders in the past year. Some sectors performed well compared with the others. According to Deloitte, in the U.S., personal consumption expenditure, or PCE, grew by 18% on recreational goods in 2020. Due to pandemic-related restrictions, health enthusiasts ended up setting up home gyms. Similarly, remote work also led the PCE on furnishing equipment to grow by 5.7%. On the other hand, spending on footwear/apparel and recreational services fell by 7.7% and 31.8%, respectively.

According to a report by McKinsey & Company, the sales of discretionary products are likely to hike in the U.S. as the country is recovering from the pandemic crisis due to vaccine rollout and stimulus payments. The report states that over 50% of the consumers, including millennials, plan to spend extra on beauty products, electronics, and apparel. Deloitte’s report, United States Economic Forecast, also stated that PCE is expected to grow by 7.6% in 2021.

Consumer discretionary companies like Comcast Corporation (NASDAQ: CMCSA), Nike, Inc. (NYSE: NKE), The Home Depot, Inc. (NYSE: HD), and Lowe’s Companies, Inc. (NYSE: LOW) have managed to increase their revenues in the past year or so. The demand for their products has risen significantly. The revenue of Nike, Inc. (NYSE: NKE) presented a massive growth of 96% year-over-year at $12.3 billion, mainly driven by increased demand in North America and China. Similarly, The Home Depot, Inc. (NYSE: HD) generated $37.5 billion in revenue, presenting 32.7% year-over-year growth.

In June, JP Morgan viewed the retail sector as one of the fastest expanding after the reopening of stores across the world. The investment bank has released a list of its top picks for investors. According to the firm, Target Corporation (NYSE: TGT), Williams-Sonoma, Inc. (NYSE: WSM), and Ulta Beauty, Inc. (NASDAQ: ULTA), The Home Depot, Inc. (NYSE: HD), and Lowe’s Companies, Inc. (NYSE: LOW) are some of the best consumer discretionary stocks to buy now.