XRT
Consumer stocks like Starbucks and McDonald's tipped to see historic
recovery
- Wells Fargo says it is has never seen consumers emerge from a
recession as strong as they are right now.
- "We are upgrading the Consumer Services industry group to Overweight
from Neutral based on: (1) the strong near-term outlook for personal
consumption expenditures, which should spur a sharp EPS recovery; (2) our
preference for high "Covid ßeta" and China exposure; and (3) oversold
technicals (relative underperformance)."
- Wells doubles down that with vaccinations proliferating and warmer
weather on the way, the expectation is for restaurants, hotels and
casinos
to benefit from significant pent-up demand over the next six to twelve
months.
- The firm also leans into the China trade, favoring large-cap consumer
services plays like Las Vegas Sands (NYSE:LVS), MGM Resorts (NYSE:MGM),
Wynn Resorts (NASDAQ:WYNN) and Starbucks (NASDAQ:SBUX).
- Wells notes that its Overweight-rated list of McDonalds (NYSE:MCD),
Starbucks, Chipotle (NYSE:CMG), Yum Brands (NYSE:YUM), Darden (NYSE:DRI),
and Marriott (NASDAQ:MAR) combine to represent 75% of the S&P500
Consumer Services Index market cap.
- The SPDR S&P Retail ETF (NYSEARCA:XRT) has already been outrunning the
S&P 500 Index of late.
|Today, 9:34 AM|14 Comments
Consumer stocks like Starbucks and McDonald's tipped to see historic
recovery
- Wells Fargo says it is has never seen consumers emerge from a
recession as strong as they are right now.
- "We are upgrading the Consumer Services industry group to Overweight
from Neutral based on: (1) the strong near-term outlook for personal
consumption expenditures, which should spur a sharp EPS recovery; (2) our
preference for high "Covid ßeta" and China exposure; and (3) oversold
technicals (relative underperformance)."
- Wells doubles down that with vaccinations proliferating and warmer
weather on the way, the expectation is for restaurants, hotels and
casinos
to benefit from significant pent-up demand over the next six to twelve
months.
- The firm also leans into the China trade, favoring large-cap consumer
services plays like Las Vegas Sands (NYSE:LVS), MGM Resorts (NYSE:MGM),
Wynn Resorts (NASDAQ:WYNN) and Starbucks (NASDAQ:SBUX).
- Wells notes that its Overweight-rated list of McDonalds (NYSE:MCD),
Starbucks, Chipotle (NYSE:CMG), Yum Brands (NYSE:YUM), Darden (NYSE:DRI),
and Marriott (NASDAQ:MAR) combine to represent 75% of the S&P500
Consumer Services Index market cap.
- The SPDR S&P Retail ETF (NYSEARCA:XRT) has already been outrunning the
S&P 500 Index of late.
|Today, 9:34 AM|14 Comments
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