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The Zacks Analyst Blog Highlights American Outdoor Brands, Crocs, Norwegian Cruise Line, Netflix and Mattel
Chicago, IL – October 31, 2024 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: American Outdoor Brands, Inc. AOUT, Crocs, Inc. CROX, Norwegian Cruise Line Holdings Ltd. NCLH, Netflix, Inc. NFLX and Mattel, Inc. MAT.
Here are highlights from Wednesday’s Analyst Blog:
5 Discretionary Stocks to Buy as Consumer Confidence Hits 9-Month High
U.S. consumers are much more confident now than they were last month. A jumbo rate cut announced last month by the Federal Reserve, coupled with optimism surrounding more interest rate cuts in the coming months, have made consumers confident about the economy's health.
Given the positive sentiment, it would be ideal to invest in discretionary stocks such as American Outdoor Brands, Inc., Crocs, Inc., Norwegian Cruise Line Holdings Ltd., Netflix, Inc. and Mattel, Inc.. These stocks have a Zacks Rank #1 (Strong Buy) or 2 (Buy) and assure good returns. You can see the complete list of today's Zacks #1 Rank stocks here.
Consumer Confidence Soars
The Conference Board said on Tuesday that the consumer confidence index surged to 108.7 in October, from 99.2 in the previous month, to hit its highest level in nine months.
The Present Situation Index, a measure of consumers' assessment of current business and labor market conditions, jumped 14.2 points to reach 138. The Expectations Index, a measure of consumers' short-term outlook for income, business, and labor market situation, rose 6.3 points to 89.1. This was comfortably above the threshold of 80. Any reading below 80 indicates impending recession.
The jump in consumer confidence comes after ebbing drastically in September on fears of a slowing economy. Interestingly, consumer confidence remained high in October despite data suggesting a cooling job market.
The Labor Department said on Tuesday that job openings fell to a three-and-a-half-year low in September. Despite the decline, the Conference Board's survey showed that consumers' perceptions of the jobs market improved in October, which boosted their confidence.
More Rate Cut Hopes Boost Consumer Confidence
Fears gripped markets earlier this month after fresh data showed a slight uptick in monthly inflation in September. This raised concerns over the economy's health, turning markets volatile.
However, consumers are hoping that inflation will still be on track to reach the Federal Reserve's 2% target. The Fed cut interest rates by 50 basis points in September, its first rate cut since March 2020.
The Federal Reserve has also hinted that more rate cuts are on the horizon if inflation continues to ease substantially. The CME FedWatch tool presently shows a 98.9% possibility of a 25-basis point cut in November and a 76.6% probability of a 20-basis point cut in December. Lower borrowing rates typically benefit growth stocks like tech and consumer discretionary.
4 Discretionary Stocks With Upside
American Outdoor Brands
American Outdoor Brands, Inc. is a provider of outdoor products and accessories, including hunting, fishing, camping, shooting and personal security and defense products, for rugged outdoor enthusiasts. AOUT produces products under the brands Caldwell; Crimson Trace; Wheeler; Tipton; Frankford Arsenal; Lockdown; BOG; Hooyman; Smith & Wesson Accessories; M&P Accessories; Thompson/Center Arms Accessories; Performance Center Accessories; Schrade; Old Timer; Uncle Henry; Imperial; BUBBA; UST; LaserLyte; and MEAT!.
American Outdoor Brands' expected earnings growth rate for the current year is 59.4%. The Zacks Consensus Estimate for current-year earnings has improved 4.1% over the past 60 days. AOUT currently sports a Zacks Rank #1.
Crocs, Inc.
Crocs, Inc. is one of the leading footwear brands with a focus on comfort and style. CROX offers a wide variety of footwear products, including sandals, wedges, flips and slides, that cater to people of all ages.
Crocs' expected earnings growth rate for the current year is 7.3%. The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the past 60 days. CROX currently carries a Zacks Rank #2.
Norwegian Cruise Line Holdings Ltd.
Norwegian Cruise Line Holdings Ltd. is a leading cruise line operator. NCLH owns and operates three brands — Oceania Cruises, Regent Seven Seas Cruises and Norwegian Cruise Line.
Norwegian Cruise Line Holdings' expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 1.9% over the past 60 days. NCLH presently has a Zacks Rank #2.
Netflix, Inc.
Netflix, Inc. is considered a pioneer in the streaming space. NFLX has been spending aggressively on building its portfolio of original shows. This is helping Netflix sustain its leading position despite the launch of new services like Disney+ and Apple TV+, as well as existing services like Amazon Prime Video.
Netflix's expected earnings growth rate for the current year is 64.4%. The Zacks Consensus Estimate for the current-year earnings has improved 3.7% over the past 60 days. NFLX currently carries a Zacks Rank #2.
Mattel, Inc.
Mattel, Inc. is the world's largest manufacturer of toys. MAT's products are sold directly to retailers and wholesalers in most European, Latin American and Asian countries as well as in Australia, Canada and New Zealand through the Mattel Girls & Boys Brands, Fisher-Price Brands, American Girl Brands, and Construction and Arts & Crafts Brands.
Mattel's expected earnings growth rate for the current year is 20.3%. The Zacks Consensus Estimate for the current-year earnings has improved 3.5% over the past 60 days. MAT presently has a Zacks Rank #2.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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