Retail Sales Scorecard 2019: ETF & Stock Winners

Sanghamitra Saha

In 2019, retail sales rose 3.6%, after about 5% gain in 2018 which marked the biggest increase in six years driven by the tailwind of tax cuts. The month of December, which is all-important to retailers due to the holiday season, saw a 0.3% sequential gain, after an upwardly revised 0.3% rise in the previous month and matching market expectations.

Against this backdrop, below we highlight a few ETF areas that may benefit from the spending pattern in the year 2019.

Gainers

Online Stores

Online and mail-order retail trade jumped 0.2% sequentially in December and 19.2% year over year. In the whole of 2019, sales surged 13.1% year over year.  

Amazon.com Inc. AMZN

The Zacks Rank #3 (Hold) company is one of the largest online retailers. Its division Amazon Web Services (AWS) has become a dominant name in the cloud-computing market (read: ETFs to Tap on Amazon's Record Holiday Sales).

Amplify Online Retail ETF IBUY

The underlying EQM Online Retail Index utilizes a rules-based methodology to select a globally diverse group of companies with 70% or more of online and virtual sales. The fund charges 65 bps in fees (read: Shop Online ETFs & Stocks for Black Friday & Beyond).

Food Services & Drinking Places

Sales at these places grew 0.2% sequentially in December and were up 4.9% year over year. In 2019, sales surged 4.4% to about $770 billion.

Denny's Corporation DENN

This is one of the largest restaurant companies, operating in moderately priced restaurants. It comes from a favorable Zacks industry (placed at the top 36% of 250+ industries) (read: 6 Sector ETFs & Stocks to Watch on December U.S. Inflation).

Invesco Dynamic Leisure And Entertainment ETF PEJ

The fund bets on a host of restaurant and entertainment companies. It has a Zacks Rank #3.

Food & Beverage Stores

Spending at food and beverage stores, which are primarily grocery stores, jumped 3% year over year to $777.0 billion in 2019. Sales from these stores gained 04% sequentially and 3.7% year over year.

The Kroger Co. KR

The Zacks Rank #3 company is one of the nation’s largest grocery retailers. It comes from a favorable Zacks industry (top 20%).

Consumer Staples Select Sector SPDR Fund XLP

The Zacks Rank #1 (Strong Buy) fund tracks the consumer staples sector of the S&P 500 Index. Beverages account for about 26% of the fund while 19.2% weight goes to Food & Staples Retailing and 17.9% weight is allocated to Food Products (read: A Look Back At S&P 500 Sector ETFs in 2019).

Health & Personal Care Stores

Spending at health and personal care stores rose 0.4% sequentially in December and was up 3.8% year over year. Sales gained 3.1% in 2019.

Procter & Gamble Company PG

It is a branded consumer products company which markets its products primarily through mass merchandisers, grocery stores, drug stores, department stores, distributors, baby stores, specialty beauty stores. The stock has a Zacks Rank #2.

The Obesity ETF SLIM

The underlying Solactive Obesity Index tracks the performance of global companies focusing on obesity-related diseases, weight-loss programs, weight-loss supplements and plus-sized apparel.

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Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
 
Amplify Online Retail ETF (IBUY): ETF Research Reports
 
Consumer Staples Select Sector SPDR Fund (XLP): ETF Research Reports
 
Invesco Dynamic Leisure and Entertainment ETF (PEJ): ETF Research Reports
 
Denny's Corporation (DENN) : Free Stock Analysis Report
 
The Kroger Co. (KR) : Free Stock Analysis Report
 
Procter & Gamble Company (The) (PG) : Free Stock Analysis Report
 
The Obesity ETF (SLIM): ETF Research Reports
 
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