5 Stocks to Buy on Solid Rebound in Consumer Confidence
Markets have been on a rally in November as inflation continues to show signs of cooling, raising hopes that the Federal Reserve may be done with its interest rate hikes. The upbeat sentiment among investors is evident from the jump in consumer confidence in November, following a three-month decline.
The Conference Board said on Nov 28 that Consumer Confidence came in at 102 in November, surpassing estimates of a rise to 101 and well above October’s downwardly revised reading of 99.1.
More importantly, consumers' expectations or the Expectations Index, which measures the outlook for business, income and labor market conditions over the next six months, jumped to 77.8 in November from 72.7 in October.
Any reading below 80 on the Expectations Index has historically signaled an impending recession within the following year. However, despite this, the month-over-month increase in percentage terms was noteworthy.
The central bank has hiked interest rates by 525 basis points over the past 18 months but left its benchmark policy rate unaltered in its past two FOMC meetings. Cooling inflation has raised hopes that the Federal Reserve may not hike interest rates further in its December policy meeting.
Investors are now expecting a 97% chance that the Fed will keep its benchmark policy rate unchanged in its current range of 5.25-5.5%, according to the CME FedWatch tool.
This has seen the market rallying throughout November. The Dow, the S&P 500 and the Nasdaq are on track to finish this month up nearly 7.2%, 8.6% and 11.1%, respectively.
Our Choices
Given the upbeat mood and soaring consumer confidence, investors should place their bet on five consumer discretionary stocks likeAMC Entertainment Holdings, Inc. AMC, NIKE, Inc. NKE, Royal Caribbean Cruises Ltd. RCL, Comcast Corporation CMCSA and Live Nation Entertainment, Inc. LYV. Each of these stocks carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
AMC Entertainment Holdings, Inc. operates as a theatrical exhibition company primarily in the United States and internationally. AMC owns or has interests in theatres and screens. AMC Entertainment Holdings, Inc. is based in Leawood, KS.
AMC Entertainment’s expected earnings growth rate for the current year is 75.2%. The Zacks Consensus Estimate for current-year earnings has improved 24.5% over the past 60 days. AMC presently carries a Zacks Rank #2.
NIKE, Inc. is engaged in the business of designing, developing and marketing of athletic footwear, apparel, equipment and accessories, and services for men, women and children worldwide. With the help of a strong brand portfolio, including Nike Pro, Nike Golf, Nike+ and Air Jordan, NKE offers premium, well-designed and high-quality products in line with the latest customer trends.
Nike’s expected earnings growth rate for the current year is 15.8%. The Zacks Consensus Estimate for current-year earnings has improved 0.5% over the past 60 days. NKE currently has a Zacks Rank #2.
Royal Caribbean Cruises Ltd. owns and operates three global brands — Royal Caribbean International, Celebrity Cruises and Azamara Club Cruises. Additionally, RCL has a 50% investment in a joint venture with TUI AG, which operates the brand TUI Cruises. Royal Caribbean Cruises' brands primarily serve the contemporary, premium and deluxe segments of the cruise vacation industry, which also includes the budget and luxury segments.
Royal Caribbean Cruises' expected earnings growth rate for the current year is 187.9%. The Zacks Consensus Estimate for current-year earnings has improved 7.3% over the past 90 days. RCL currently has a Zacks Rank #2.
Comcast Corporation is a global media and technology company with three primary businesses: Comcast Cable, NBCUniversal and Sky. Beginning first-quarter 2023, CMCSA changed its presentation of segment operating results around its two primary businesses, Connectivity & Platforms, and Content & Experiences.
Comcast Corporation’s expected earnings growth rate for the current year is 8%. The Zacks Consensus Estimate for current-year earnings has improved 3.1% over the past 60 days. CMCSA presently carries a Zacks Rank #2.
Live Nation Entertainment, Inc. operates as a live entertainment company. LYV operates through the Concerts, Ticketing, and Sponsorship and Advertising segments. Live Nation Entertainment has more than 580 million fans across all of its concerts and ticketing platforms in 46 countries.
Live Nation Entertainment’s expected earnings growth rate for the current year is 132.8%. The Zacks Consensus Estimate for current-year earnings has improved 47.5% over the past 60 days. LYV presently has a Zacks Rank #2.
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NIKE, Inc. (NKE) : Free Stock Analysis Report
Comcast Corporation (CMCSA) : Free Stock Analysis Report
Royal Caribbean Cruises Ltd. (RCL) : Free Stock Analysis Report
Live Nation Entertainment, Inc. (LYV) : Free Stock Analysis Report
AMC Entertainment Holdings, Inc. (AMC) : Free Stock Analysis Report
