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The Zacks Analyst Blog Highlights: Abercrombie & Fitch, Tilly's, Tapestry, RH and Haverty Furniture

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·6 min read
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For Immediate Release

Chicago, IL – September 21, 2021 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Abercrombie & Fitch Co. ANF, Tilly’s, Inc. TLYS, Tapestry, Inc. TPR, RH RH and Haverty Furniture Companies, Inc. HVT.

Here are highlights from Monday’s Analyst Blog:

5 Top-Ranked Retail Stocks to Buy Ahead of the Fall Season

Market pundits were concerned about a sharp slowdown in economic recovery in the third quarter. Shortage in inventory coupled with the spread of the Delta variant of COVID-19 compelled economists to slash GDP projections for the present quarter. However, sales at U.S. retailers improved surprisingly, squashing concerns about a sharp slowdown in third-quarter GDP.

The Commerce Department noted that retail sales bounced back in the month of August from July, possibly banking on the back-to-school shopping spree. In fact, sales were mostly driven by an uptick in online purchases, which easily offset the drop in sales at auto dealers. To put things into perspective, sales at U.S. retailers increased 0.7% in August from a downwardly revised July's reading of 1.8%, citing a Reuters article. The article further stated that retail sales actually jumped 15.1% last month from the year-ago period and are now up 17.7% from the pre-pandemic levels.

Most importantly, online retail sales jumped 5.3% last month after tanking 4.6% in July, the Reuters article stated. Additionally, sales at clothing stores as well as building material and furniture stores edged up last month. However, sales at auto dealers took a beating due to the global shortage of microchips. Nonetheless, so-called core retail sales that mostly reflect the spending component of GDP, rebounded 2.5% in August from a downwardly revised drop of 1.9% in July, added the article.

What's more, the National Retail Federation stated that the unexpected rise in retail sales last month showed the continued strength among American consumers and that they do expect a stellar 2021 for retail sales, including a strong holiday season for U.S. retailers. Moreover, Americans are no doubt sitting on excessive cash that they accumulated during the pandemic and are now willing to splurge. Needless to say, wages are also increasing, which may lead to more spending, something that bodes well for retailers in the near term.

In fact, citing a prnewswire article, per Deloitte's annual holiday sales prediction, retail sales for the holiday season are expected to increase between 7% and 9% this year. The retail sales figure is expected to come in at $1.28-$1.3 trillion during November to January.

During the holiday season, Deloitte expects e-commerce sales to jump 11-15% on a year-over-year basis to $210-$218 billion. Similarly, Mastercard SpendingPulse noted that excluding automotive and gas, sales at U.S. retailers are projected to grow 7.4%, with consumers willing to spend more online, as mentioned in a fibre2fashion article.

Thus, given the positives, retailers are set to witness a strong rally heading into the fall season. Hence, it will be prudent to invest in five of the best retail stocks that have a Zacks Rank #1 (Strong Buy) or 2 (Buy).

Abercrombie & Fitch operates as a specialty retailer of premium, high-quality casual apparel for men, women, and kids through a network of approximately 850 stores across North America, Europe, Asia and the Middle East. The company has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has moved up 33.3% over the past 60 days. The company's expected earnings growth rate for the current year is 702.7%.

Tilly’s is a specialty retailer in the action sports industry selling clothing, shoes and accessories. The company has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has moved up 29.8% over the past 60 days. The company's expected earnings growth rate for the current year is 4,350%.

Tapestry offers lifestyle products, which include handbags, women's and men's accessories, footwear, jewelry, seasonal apparel collections, sunwear, travel bags, fragrance and watches. The company has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has moved up 8.8% over the past 60 days.

The company's expected earnings growth rate for the current year is 12.5%. You can see the complete list of today's Zacks #1 Rank stocks here.

RH is a leading luxury retailer in the home furnishing space. The company has a Zacks Rank #1. The Zacks Consensus Estimate for its current-year earnings has risen 15.4% over the past 60 days. The company's expected earnings growth rate for the current year is 45.3%.

Haverty Furniture is a full-service home furnishings retailer. The company has a Zacks Rank #2. The Zacks Consensus Estimate for its current-year earnings has moved up 23.1% over the past 60 days. The company's expected earnings growth rate for the current year is 163.3%.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.


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Abercrombie & Fitch Company (ANF) : Free Stock Analysis Report
 
RH (RH) : Free Stock Analysis Report
 
Haverty Furniture Companies, Inc. (HVT) : Free Stock Analysis Report
 
Tillys, Inc. (TLYS) : Free Stock Analysis Report
 
Tapestry, Inc. (TPR) : Free Stock Analysis Report
 
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