E-commerce has been breathing life into the retail sector, which is trying to stand on its feet, and by doing so has emerged as the preferred mode of shopping for most Americans over the past few months. An increasing number of Americans are relying on online shopping as fears of the deadly coronavirus fail to subside. Although the economy has opened, shopping online — particularly for grocery — remains the preferred choice.
According to a new report by eMarketer, online shopping is expected to grow further this year. Also, the trend is likely to continue as people are finding it more convenient and cuts out the risk factor of getting infected by the deadly virus.
Online Grocery Sales Poised to Grow
According to eMarketer, online grocery sales in the United States are projected to reach $89.22 billion in 2020, indicating a jump of 53% from last year.
Moreover, online grocery sales are expected to reach $129.72 billion by 2023, accounting for 10% of overall grocery sales. The pandemic has seen a large number of Americans shifting to online shopping than visiting physical stores. The report further projects total online grocery buyers to reach 131 million by the end of this year. This suggests a 41.9% jump from the previous year.
Coronavirus Driving Online Grocery Sales
Although online grocery sales declined somewhat in October as more people have started visiting brick-and-mortar stores, fears of the second wave might once again compel them to stay indoors. Hence, online shopping will remain the preferred choice for most. Stockpiling on fears of coronavirus spreading at a rapid rate saw online grocery sales growth in the first few months.
Also, many who are hesitant to shop at a physical store but at the same time don’t want to pay for certain online grocery items have been going for curbside pickup, which is driving online sales further.
Although chances are unlikely that the country will go for another lockdown, growing cases of coronavirus have once again raised fears in the minds of people. Preventive measures to keep the virus at bay are likely to see people ordering for all household necessities, including grocery, online. Given this situation, it would be prudent to watch out for these five stocks that are likely to rally on a sharp rise in demand for online grocery in the near future.
Target Corporation TGT has evolved from just being a pure brick & mortar retailer to an omni-channel entity. The company has been investing in technologies, improving websites and mobile apps, and modernizing the supply chain to keep pace with the changing retail landscape and better compete with pure e-commerce players.
The company’s expected earnings growth rate for the current year is 13.9%. The Zacks Consensus Estimate for current-year earnings has improved 1.8% over the past 60 days. Target carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Kroger Co. KR operates supermarkets, multi-department stores, marketplace stores and price impact warehouse stores. Its combination food and drug stores offer natural food and organic sections, pharmacies, general merchandise, pet centers, fresh seafood, and organic produce; and multi-department stores provide apparel, home fashion and furnishings, outdoor living, electronics, automotive products, and toys.
The company’s expected earnings growth rate for the current year is 49.1%. The Zacks Consensus Estimate for current-year earnings has improved 1.5% over the past 60 days. Kroger has a Zacks Rank #2.
The Hain Celestial Group, Inc. HAIN offers a wide range of popular better-for-you groceries, snacks and tea.
The company’s expected earnings growth rate for the current year is 46.4%. The Zacks Consensus Estimate for current-year earnings has improved 7.9% over the past 60 days. The Hain Celestial Group holds a Zacks Rank #2.
United Natural Foods, Inc. UNFI carries more than 1,10,000 high-quality natural, organic and specialty products, consisting of national, regional and private label brands in six product categories. These categories are — grocery and general merchandise, produce, perishables and frozen foods, nutritional supplements and sports nutrition, bulk and foodservice products as well as personal care items.
The company’s expected earnings growth rate for the current year is 26.5%. The Zacks Consensus Estimate for current-year earnings has improved 94.4% over the past 60 days. United Natural sports a Zacks Rank #1.
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