William Blair issued some bullish calls for some lesser-known consumer stocks, adding Burlington Stores, J&J Snack Foods, National Vision and Six Flags to its short-term focus list.
However, these aren’t the only overlooked names in the consumer space. CNBC’s “Trading Nation” on Wednesday asked two traders about their preferred ways to play for strength in an area where other investors may not be watching.
“We see credit cards as a way to play the reopening because no matter how you spend your money, you have to spend it somehow,” said Gina Sanchez, CEO of Chantico Global and chief market strategist at Lido Advisors.
Sanchez calls Visa a name that could benefit if hit badly during the pandemic. Worst-case, Visa fell nearly 40% from a high in February 2020 to a low in March 2020. It has risen by more than 70% since then and didn’t hit an all-time high until late April.
“They are really starting to amass volume, their revenue and earnings seem to really hit records when the reopening happens, especially because they are so strong in the US, Europe and China,” Sanchez said.
Boris Schlossberg, Managing Director of FX Strategy at BK Asset Management, was looking for a winner under the radar in retail.
“I really like Five Below, kind of a never-ending treasure hunt concept. What makes Five Below interesting is that it’s upscale [end] of the dollar store segment. The stock has done very, very well. It has tripled in the past four years, “Schlossberg told CNBC.
Five Below is up nearly 13% in 2021, better than the 11% increase for the S&P 500.
“It just has [around 1,000] Shops across the country, so plenty of room to grow, “said Schlossberg.” It attracts both the idea of findability and abundance, but more attractive goods at a slightly higher price. “
Disclosure: Lido Advisors invests in Visa.
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