But the idea that Black Friday marks a bullish phase in consumer discretionary investing is now a myth. Consumers are cash-strapped, retailers are better at managing inventory, and online shopping is distorting the dynamics of shopping.
Investors can get ahead of the pack in trying to predict the winners on Black Friday. Here are the ways to do so:
1) Look for Companies Offering deals sooner
Associated Press reported that The Walt Disney Company (NYSE:DIS), Sears Holdings Corporation (NASDAQ:SHLD), and Kohl’s Corporation (NYSE:KSS) are offering deals ahead of Black Friday. Wal-Mart Stores, Inc. (NYSE:WMT) is also discounting products a few hours earlier as they cut prices late on Thanksgiving day. Wal-Mart, Sears, Kmart and Toys R Us will all open stores at 8 p.m. Thanksgiving day.
2) Browse coupon and deal-finding aggregators.
Associated Press listed a number of web sites to find shopping deals. bradsdeals.com and blackfriday.com were two sites that were listed.
3) Use Social Media
Social media is also another way to get alerts on shopping deals and store hours. Liking a page on Facebook Inc (NASDAQ:FB) or searching for trends on Twitter or Google+ may be useful. Investors should look out for companies giving too steep a discount: this would hurt profit margins
4) Anticipate Electronics To Do Well Again
Nintendo Co., Ltd (PINK:NTDOY) is releasing its Wii U. Activision Blizzard, Inc. (NASDAQ:ATVI) released another version of Call of Duty. LCD TV’s are already saturated, so expect companies relying on TV sales to get no upside from Black Friday.
5) Go To eBay Inc (NASDAQ:EBAY) and Amazon.com, Inc. (NASDAQ:AMZN)
eBay and Amazon are the biggest online retailers. Deals offered there will give investors an idea on trending consumer goods. Not to be forgotten, Overstock.com, Inc. (NASDAQ:OSTK)‘s homepage features a countdown to Black Friday and advertises big discounts.
Business Section: Investing Ideas
Black Friday could provide a lift for the retailing sector, but it will be of little help for companies in a long-term struggle. J.C. Penney Company, Inc. (NYSE:JCP), whose sales fell 27% in the last quarter, is having trouble attracting sales with its new boutique concept.
GameStop Corp. (NYSE:GME) is facing chronic challenges as game-makers reduce re-sales for used games and promote digital-downloading and add-ons.
Sears Holdings Corporation (NASDAQ:SHLD), The Gap Inc. (NYSE:GPS), and Best Buy Co., Inc. (NYSE:BBY) are planning special deals and earlier store hours. Staples, Inc.(NASDAQ:SPLS) will be promoting technology, discounting Hewlett-Packard Company (NYSE:HPQ) computers.
Black Friday kicks off the holiday shopping season, which can generate as much as 40% of a company’s total annual retail sales. We feel this important event deserves a closer look:
Amazing Thanksgiving Infographic! Stock picks for Black Friday & Cyber Monday
Looking for more ways to trade the Black Friday and Cyber Monday trend? Consider adding following stocks to your watch list:
OTHER POPULAR RETAILERS
1. Target Corp. (TGT, Earnings, Analysts, Financials): Operates general merchandise stores in the United States. Market cap at $40.89B, most recent closing price at $62.44.
Similar to Wal-Mart, Target has several door buster deals and plans to open stores on Thanksgiving day, at 9pm. It has received complaints that their determination to boost sales comes at the expense of their employees’ Thanksgiving evening. Target has responded by claiming their decision to open at 9pm reflects consumers’ preference to shop right after their dinner. They also claim employee preferences are taken into account when scheduling Thanksgiving shifts.
2. Macy’s, Inc. (M, Earnings, Analysts, Financials): Operates department stores and Internet Web sites in the United States. Market cap at $15.84B, most recent closing price at $39.34.
Macy’s has always been a popular shopping destination, especially for the mall scene. The store is a natural beneficiary of the black Friday rush to other popular shops in malls and shopping strips. Macy’s is offering online Black Friday specials online Thursday November 22nd through Saturday November 24th. Stores will open at midnight through 1pm on Friday, November 23rd. Their website features several holiday deals, and a phone app so shoppers can receive in-store alerts on Black Friday specials.
3. Saks Incorporated (SKS, Earnings, Analysts, Financials): Operates fashion retail stores in the United States. Market cap at $1.51B, most recent closing price at $9.90.
Saks Fifth Avenue represents some of the higher end retailers, including Nordstrom, Inc. (NYSE:JWN), Tiffany & Co.(NYSE:TIF). Like Macy’s these are common retailers in malls. But unlike Macy’s, these stores are offering consumers who might be scared away by rowdy crowds a more “white glove” experience.
Typically these high-end retailers do not offer promotions during the holidays. Although Saks made an exception last year offering discounts neat 70% off on popular brands, SmartMoney has predicted this year discounts will be “few and far between.” Saks has yet to announce their Black Friday hours.
4. HSN, Inc. (HSNI, Earnings, Analysts, Financials): Markets and sells a range of third party and private label merchandise primarily in the United States. It operates as an interactive multi-channel retailer, offering retail experiences through various platforms, including television, online, mobile, catalogs, and retail and outlet stores. Market cap at $2.69B, most recent closing price at $49.60.
HSN, owner of the Home Shopping Network, is already a popular retailer. It will begin offering Black Friday deals and coupons as early as November 21.
SHIPPING
As items purchased online must be shipped, FedEx and UPS are without a doubt one of the biggest beneficiaries of Cyber Monday.
It’s been reported that “FedEx is forecasting a 13 percent increase in shipping this holiday season as compared with last; UPS predicts a 10 percent increase; and the U.S. Postal Service expects a whopping 20 percent jump in the number of packages shipped between Thanksgiving and Christmas.”
5. FedEx Corporation (FDX, Earnings, Analysts, Financials): Provides transportation, e-commerce, and business services in the United States and internationally. Market cap at $27.18B, most recent closing price at $86.54.
“FedEx predicts it will ship 280 packages, an increase from the 247 million packages last year.” FedEx says it will add 20,000 holiday workers to handle the 13% boost.
6. United Parcel Service, Inc. (UPS, Earnings, Analysts, Financials): Provides transportation, logistics, and financial services in the United States and internationally. Market cap at $67.1B, most recent closing price at $70.33.
“UPS expects to move 527 million packages between Thanksgiving and Christmas this year, exceeding last year’s record of 480 million packages.”
This article was originally written by Chris Lau and Rebecca Lipman, and posted on Kapitall.
