With the holidays just about here, you’re likely scrambling to get your gift-giving list together and strategizing about what to buy, when to buy it, who to buy it from and how to get it there. All of those choices — made by you and millions of others just like you — are going to make some investors very rich this winter. That’s because they’ll have given themselves the gift of wise investments this holiday season. Every investment comes with risk and there’s no such thing as a guarantee on the stock market, but there are plenty of clear indications that a few stocks are poised to make big gains this winter.
Every stock on this list is directly tied to holiday shopping. Some sell things people will buy for the holidays. Others provide platforms for other people to sell those things. And then others ship those things while others distribute them. All, however, are strongly positioned to gobble up their piece of the market share pie and then some.
Last updated: Nov. 16, 2020
Amazon has been one of the great stocks of the 21st century and has served as the basis for countless tantalizing articles about how massive your fortune would be now if you had put up just a few grand in the beginning. The world’s largest online retailer has, of course, proven its worth and adaptability. And with a busy and mostly online holiday season expected, potential investors have all the incentive to jump in now. Another reason that Amazon is poised for a big win over the holidays is the success it just had with its own holiday. Sales on this year’s Amazon Prime Day grew by 60% over last year.
The Big Lots business model has many analysts expecting a strong showing from the company’s stock this holiday season and beyond. First off, it’s a discount retailer that specializes in bulk sales, a formula that’s custom-made for an era defined by financial uncertainty and anxiety. Another attractive facet is the Big Lots strategy of purchasing struggling smaller retailers for profit — and thanks to the COVID-19 crisis, there are plenty of small retailers for Big Lots to gobble up and plenty of profits to be had.
Americans spent a record $95.7 billion on their pets in 2019, so the trend toward pet spending was already in Chewy’s favor before the pandemic. Then came the shutdown, which led to a massive uptick in dog and cat adoptions, presumably to help keep lonely and comfort-hungry shut-ins sane during the quarantine. That, naturally, led to an even greater explosion in pet-related purchasing which continues to unfold as the holidays approach. That trend, combined with a dramatic increase in online buying, positions the $26 billion pet giant that is Chewy to harvest a huge windfall over the holidays.
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Dollar Tree, which also owns Family Dollar, has underperformed on the year. That has kept the stock’s price below $95 — a deal that’s too good to pass up for many industry watchers. Analysts predict the stock’s value will rise over the holidays because they expect to see a large increase in consumer demand for inexpensive household products, much of which is directly linked to pandemic-related financial uncertainty. Also, the company has invested heavily in upgrading, improving and expanding the struggling Family Dollar chain.
Few companies have benefited more from the rise of e-commerce than Etsy, a trend that has only accelerated in recent months. But Etsy has something going for it that few other online selling platforms can match. It specializes in handmade items that individuals sell through their personal shops. With millions out of work, strapped for cash and trapped at home, legions of new side hustlers have learned to turn their hobbies into part-time gigs — and many of them have turned to Etsy as their platform of choice. Etsy’s revenue increased 136.7% year over year, and moving into the holidays it has a rare competitive advantage: You simply can’t get the stuff it sells anywhere else.
At the end of October, FedEx shareholders celebrated when the transportation and shipping company reached an all-time high of $293.30 — a number that represented gains of 90% on the year. The stock has fallen back to Earth a bit since then, but shares are still pricey. Even so, many analysts think that the best is yet to come. The reason is self-explanatory: The COVID-19 crisis created a massive surge in online buying that is all but certain to extend through the season and FedEx delivers many of the packages that people buy and sell online.
iShares Transportation Average ETF
There’s nearly universal consensus that shipping companies will prosper this holiday season, but you might be hesitant to put all your eggs in one basket. If diversity is important to you, you can own UPS, FedEx and many other well-known shippers with this exchange-traded fund, including Union Pacific, Norfolk Southern, Kansas City Southern and more. The ETF allows you to buy into all the big dogs in an industry poised for success at the same time with a single stock purchase.
Nike, of course, needs no introduction, but the footwear and apparel giant is making moves that have money managers urging their clients to get their hands on Nike stock. First of all, Nike has made a huge and successful effort to dramatically improve its digital presence from the very beginning of the pandemic. The result has been an 82% increase in year-over-year digital sales — Nike now is ready to cash in on the holidays. It just launched its highly anticipated Jordan Brand Holiday 2020 Winter Utility Collection and is set to release its equally hyped Kyrie Irving Signature Collection.
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The pandemic has been a blessing — financially, at least — for Overstock.com shareholders. The company was dying on the vine before the virus emerged. Its value was whittled down to less than $5 per share. After the market hit rock bottom in March, however, Overstock skyrocketed by an astonishing 5,000%. Those who didn’t sell at that peak watched much of those gains dwindle, but on the year, the company is still up more than 1,000% with plenty of room to grow when Santa comes to town.
Right now, UPS is positioned as a classic momentum stock — the kind you buy when it’s high and sell when it’s higher. The company just turned in its second straight amazing quarterly report and many industry-watchers expect the gains to keep piling up when the holidays roll around. The optimism is largely for the same exact reasons FedEx looks like such a good investment — holiday shopping will be done mostly online this year and UPS deliveries will get many of those gifts from point A to point B.
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This article originally appeared on GOBankingRates.com: 10 Stocks Set To Soar From Holiday Shopping