As the Tokyo Olympics draw to a close and children begin returning to school following the summer season, four stocks with high profitability and could benefit from back-to-school shopping trends include Walmart Inc. (
Coronavirus trends worsen as students start shopping for the return to school
According to CNBC, major U.K.-based consulting company Deloitte has estimated that back-to-school spending for students in grades K-12 this year would increase by approximately 16% from last year and approximately 17% from 2019. Despite the strong shopping trends, new surges in coronavirus cases and other related shipping and industry constraints may slow momentum in back-to-school spending.
On Sunday, the U.S. reported a seven-day average of 108,600 new Covid-19 cases, up 36% from a week prior according to Johns Hopkins University statistics.
Despite the concerns regarding the possible slowdown in back-to-school spending, investors can still find opportunities in companies specializing in back-to-school retail products. GuruFocus’ All-in-One Screener listed four such stocks with a profitability rank of at least 7.
WMT, Financial) sells a wide range of general merchandise, grocery and clothing items. GuruFocus ranks the Bentonville, Arkansas-based company’s profitability 7 out of 10 on the back of profit margins and returns outperforming more than 68% of global competitors.
Gurus with large holdings in Walmart include
TGT, Financial) operates a network of stores that retail beauty and household products, groceries, clothing and apparel and other essential office products. GuruFocus ranks the Minneapolis-based company’s profitability 8 out of 10 on several positive investing signs, which include a three-star business predictability rank, a high Piotroski F-score of 9 and profit margins and returns that outperform more than 88% of global competitors.
Gurus with large holdings in Target include
Big Lots (
BIG, Financial) operates a network of discount retail stores that offer grocery, home and office products. GuruFocus ranks the Columbus-based company’s profitability 8 out of 10 on several positive investing signs, which include a high Piotroski F-score of 8 and profit margins and returns that outperform more than 81% of global competitors.
Newell Brands (
NWL, Financial) produces a wide range of school supply products through brands like Paper Mate, Sharpie, EXPO and Rubbermaid. GuruFocus ranks the Atlanta-based company’s profitability 7 out of 10 on several positive investing signs, which include a high Piotroski F-score of 7 and profit margins and returns that outperform more than 70% of global competitors.