The retail industry has had to adapt to a new paradigm since the turn of the century. The rise of e-commerce has changed the way consumers shop, with brick-and-mortar stores finding it difficult to compete with the ease of online shopping. For these names, it comes down to the reigning mantra of adapt or die.
Investment firm Needham recently surveyed its shopping basket of retail stocks under coverage in order to reassess how they look going into the year ahead. “We favor companies with strong secular tailwinds, those with discounted valuations that can benefit from self-help, and premium brands with pricing power,” said analyst Rick Patel.
Taking these factors into consideration, we did some research of our own. Using TipRanks’ handy Stock Comparison tool, we were able to get a clearer picture of how the year will pan out for 2 of the investment bank’s choices. It turns out that on top of the Needham recommendation, both currently boast a “Strong Buy” consensus rating from the Street. Let’s take a closer look.
Nike Inc. (NKE)
Nike, obviously, needs no introduction. The global swish machine has a market cap of $150 billion and is the biggest athletics company in the world. Not to mention it had a strong run in 2019, ending the year with an additional 38% attached to its share price. According to Patel, the positive momentum is set to continue through 2020, too.
One of the key drivers for Nike this year is this summer’s Tokyo Olympics. Nike’s superior product and marketing has come to the fore during global…