Summer Spending: 3 Stocks Set to Benefit
Summer is just around the corner, with a resilient consumer looking to take full advantage of the warmer months. As we’re all aware, consumers (myself included) typically go on vacations, engage in outdoor activities, and spend cash on other discretionary items throughout the period.
And, of course, several companies are looking to capitalize on spending habits throughout the summer, including Pool Corp. POOL, Dick’s Sporting Goods DKS, and Camping World CWH.
But are they worth consideration before the summer starts heating up? Let’s take a closer look at each.
Pool Corp.
Pool Corp. is the world's largest wholesale distributor of swimming pool supplies, equipment, and related products.
Perhaps to the surprise of some, POOL shares are massive long-term winners, up an unbelievable 13000% over the last 25 years and crushing the S&P 500’s impressive 670% gain. The stock has been the definition of an under-the-radar gem.
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Shares aren’t expensive on a relative basis, with the current 22.4X forward earnings multiple sitting well below the 30.8X five-year median and highs of 36.3X in 2022. Over the last five years, shares have traded as high as 50.6X.
The stock sports a Style Score of “C” for Value.
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Shares also pay a dividend, currently yielding 1.3% annually. Impressively, the company has grown its payout by more than 20% over the last five years, reflecting a shareholder-friendly nature.
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Camping World
Camping World is a provider of services, protection plans, products, and resources for recreational vehicle enthusiasts.
Shares found plenty of buyers following the company’s latest quarterly results, as shown in the chart below.
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Regarding the mentioned quarter, Camping World posted a sizable 600% EPS beat and reported sales marginally below expectations. In addition, the company posted record gross profit performance within used vehicles, helping to explain the dramatic upward move in shares post-earnings.
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And to top it off, CWH shares currently yield 8.6% annually, well above the Zacks Consumer Discretionary sector average. The company’s payout has grown by an impressive 80% just over the last five years.
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Dick’s Sporting Goods
Dick’s Sporting Goods is a significant omnichannel sporting goods retailer, offering athletic shoes, apparel, accessories, and a broad selection of outdoor and athletic equipment for team sports, fitness, camping, fishing, tennis, golf, water sports, etc.
The sports retailer posted results nicely above expectations in its latest release, exceeding our consensus EPS estimate by roughly 5%. Quarterly revenue totaled $2.8 billion, modestly above expectations and improving 5.3% from the year-ago period.
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In addition, shares have recently bounced off the 200-day moving average, an area that’s acted as support in the past. This bullish action is illustrated in the chart below.
Image Source: Zacks Investment Research
Analysts have become bullish on the company’s current fiscal year, with the $13.48 per share estimate being revised 15% higher since June of last year.
Image Source: Zacks Investment Research
Bottom Line
With summer looming, consumers will soon be flocking outside and spending on discretionary items.
And several companies, including Pool Corp. POOL, Dick’s Sporting Goods DKS, and Camping World CWH, stand to benefit from the spending trends throughout the period.
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Pool Corporation (POOL) : Free Stock Analysis Report
DICK'S Sporting Goods, Inc. (DKS) : Free Stock Analysis Report
Camping World (CWH) : Free Stock Analysis Report
