For Immediate Release
Chicago, IL – December 23, 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: The Children's Place (NASDAQ:PLCE), Inc. PLCE, Capri Holdings (NYSE:CPRI) Ltd. CPRI, Boot Barn (NYSE:BOOT) Holdings, Inc. BOOT and Tapestry (NYSE:TPR), Inc. TPR.
Here are highlights from Wednesday’s Analyst Blog:
4 Apparel Stocks Poised to Continue Winning Streak in 2022
While coronavirus-inflicted challenges persist, the apparel industry has been steadily making its way out of the woods and is now set for a complete recovery in 2022. The pandemic hit the industry hard as virus-wary shoppers remained confined at home, resulting in lower demand and consequently a huge blow to sales. But as the economy reopened, pandemic-led restrictions eased and outdoor movement gathered pace, the apparel industry has blossomed.
With Americans refreshing their wardrobes, thanks to the resumption of active social lifestyles, events and occasions, the industry has been witnessing a resurgence in demand. Sales at clothing & clothing accessories stores have been increasing as more people venture out. Indeed, the pandemic-relief package and stepped-up vaccinations played a major role in boosting consumer confidence.
Per the Commerce Department, sales at clothing & clothing accessories stores grew 34.8% year over year during November 2021. This followed an increase of 26.7% in October from the prior-year period. Companies in the apparel space will leave no stone unturned to tap any surge in demand unless derailed by the new COVID-19 variant — Omicron — that is spreading fast, posing a threat to economic recovery.
Trends to Watch in 2022
While inventory management, supply-chain enhancement and cost-structure realignment will be paramount in 2022, investment to accelerate digitization will also be fast-tracked. Industry participants will continue to emphasize membership programs, upgrading of store technology and omni-channel capabilities, shopping via mobile app, last-mile delivery solutions, and forming an alliance with digitally native retailers.
Players in the industry have been aggressively adopting strategies and making planned investments to cater to customer demand in-store or online. Undeniably, expedited delivery services like doorstep delivery, curbside pickup or buy online and pick up at store as well as contactless payment gateway will continue to play a crucial role in maximizing the share of customers’ wallets.
Industry experts cited that companies also need to rework assortments to meet emerging trends in the post-pandemic world, including a more customized approach. Apparel companies also need to increase product visibility on online platforms, enhance customer engagement on social channels and make logistical improvements.
That said, we have shortlisted four apparel stocks that carry a Zacks Rank #1 (Strong Buy) or 2 (Buy), have a market cap of more than $1 billion and are up more than 20% so far this year. You can see the complete list of today’s Zacks #1 Rank stocks here.
4 Prominent Picks
The Children's Place, a pure-play children’s specialty apparel retailer, is worth betting on. The company has constantly been deploying resources to expand product offerings, upgrade distribution channels, create seamless omni-channel capabilities, and deepen customer engagement. Structural changes made in business last year and incremental digital investments made pre-pandemic have contributed to its performance.
The Children's Place’s bottom line has outperformed the Zacks Consensus Estimate by a wide margin in the trailing four quarters. The Zacks Consensus Estimate for The Children's Place’s fiscal 2022 earnings per share (EPS) has moved up 16.4% in the past 60 days. The stock sports a Zacks Rank #1.
You may invest in Capri Holdings. The company has been reinforcing its position in the luxury fashion space and looks to maximize the potential of Versace, Jimmy Choo and Michael Kors brands through expanded products and categories.
Capri Holdings’ bottom line has outperformed the Zacks Consensus Estimate by a wide margin in the trailing four quarters. This Zacks Rank #1 company has an estimated long-term earnings growth rate of 32.2%. The Zacks Consensus Estimate for Capri Holdings’ upcoming financial year EPS has risen by a penny in the past 30 days.
We also suggest betting on Boot Barn. This lifestyle retailer of western and work-related footwear, apparel and accessories has been successfully navigating through the challenging environment, courtesy of merchandising strategies, omni-channel capabilities and better expense management as well as marketing. This combined with the expansion of the store base, has helped the company gain market share and strengthen its position in the industry.
Impressively, Boot Barn Holdings has a trailing four-quarter earnings surprise of 35.3%, on average. This Zacks Rank #1 company has an estimated long-term earnings growth rate of 20%. The Zacks Consensus Estimate for Boot Barn Holdings’ next financial year EPS has moved north 1.2% in the past 30 days.
Tapestry, the provider of luxury accessories and branded lifestyle products, is another potential pick. The company has been benefiting from the successful execution of the Acceleration Program. The program aims to transform the company into a leaner and more responsive organization. It intends to build significant data and analytics capabilities, focusing on enhancing digital and omni-channel capabilities and operating with a clearly defined path and strategy for each of its brands, namely Coach, Kate Spade, and Stuart Weitzman.
Tapestry has a trailing four-quarter earnings surprise of 29%, on average. This Zacks Rank #2 company has an estimated long-term earnings growth rate of 12.3%. The Zacks Consensus Estimate for Tapestry’s next financial year EPS has increased 7.7% in the past 60 days.
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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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Boot Barn Holdings, Inc. (BOOT): Free Stock Analysis Report
The Children's Place, Inc. (PLCE): Free Stock Analysis Report
Tapestry, Inc. (TPR): Free Stock Analysis Report
Capri Holdings Limited (CPRI): Free Stock Analysis Report
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