Why Retail? Why the Consumer Goods industry? Well, there are a few things to consider: 

– Strong spending and purchasing power in the overall retail sector. 

– Inflation has decreased from its peak in 2022. 

– Consumer spending remained robust in July, with retail sales growing by 0.7%. – The consumer goods market is projected to reach $3 trillion by the end of 2023. – Analysts project a 3.2% rate in annual growth from 2023 to 2028. 

We like positive data, and we want sectors that are performing well. That’s absolutely the case here, and we have three stocks in particular that highlight these principles… 

Albertsons Companies Inc (ACI) 

Albertsons Companies (ACI) stands out as a formidable contender in the retail sector, capitalizing on its commitment to efficient in-store services and elevating digital and omnichannel capacities. ACI is also known for driving enhanced productivity. The ongoing initiatives undertaken by ACI to enrich its range of products consistently elevate the holistic customer journey. Notably, ACI presents a projected long-term earnings growth rate of 8%, further underscoring its potential for sustained growth. 

ACI, currently up year-to-date by 6.85%, has a positive 20/200 day SMA (simple moving average), positive year-over-year revenue and momentum growth, a PEG (price/earnings to growth) ratio of 1.63x, and a solid 0.37 beta score. ACI most recently beat analysts’ projections on EPS, reporting $0.93 per share vs. $0.85 as expected (a 9.8% win), and has exceeded estimates for 12 consecutive quarters. ACI has an annual dividend yield of 2.17% and a quarterly payout of 12 cents ($0.48/year) per share. For the current quarter, ACI is expected to post $18.2 billion in sales at $0.62 per share. With a 10-day average volume of 2.5 million shares, ACI has an average price target of $25, with a high of $27.25 and a low of $21, indicating the potential for a 23% jump from its current price. While up YTD, ACI is trading near the bottom of its 52-week range, leaving plenty of room to move in the right direction. 

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Unilever PLC (UL) 

Based in London, U.K., Unilevel PLC (UL) is a fast-moving consumer goods firm that markets items under renowned brands such as Ben and Jerry’s, Axe Bodyspray, LUX, Seventh Generation, and others. On April 3rd, UL achieved a substantial cloud transition project via partnerships with Microsoft Corp. (MSFT) and 

Accenture PLC (ACN). By adopting Azure’s cloud platform, UL has streamlined operations, improving new product introductions, customer support, and overall efficiency. UL also recently disclosed the sale of its Suave brand in North America to Yellow Wood Partners LLC. This divestiture underscores UL’s successful strategy of re-designing its portfolio towards targeted growth sectors. 

UL is up slightly year-to-date by 0.41% and is trading around the middle of its existing 52-week price range. With a positive SMA, $7.6 billion in free cash flow, and a 0.51 beta score. Regarding its last earnings call, UL beat analysts’ revenue forecasts by 2% while also reporting year-over-year growth in key areas like revenue (+2.72%), net income (+22.13%), EPS (+25%), and net profit margin (+18.86%). UL has a 3.46% annual dividend yield, a quarterly payout of 47 cents ($1.88/year) per share, and a 62.88% payout ratio.

With a 10-day average volume of 1.93 million shares, UL has a median price target of $58.15, with a high of $68.01 and a low of $41.18; this represents an almost 34% potential price upside. 

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Edgewell Personal Care Co (EPC) 

Oddly, the insider investment in Edgewood Personal Care Co. (EPC) was the first thing I noticed about it. It emphasizes EPC’s alignment with shareholders’ interests, boosting market confidence. With an insider holding valued at around $19 million overall, there’s a strong sense of conviction in the firm’s strategy; this holding, while significant, only represents about 1% of the EPC’s shares. Evaluating revenue growth and earnings margins provides insights into sustainable profit growth, and EPC maintained steady margins while achieving a 3.5% revenue increase to $2.3 billion over the past year. This is a promising combination. 

EPC is down year-to-date by 2.85%, has a 0.87 beta, almost $200 million in free cash flow, a P/S (price to sales) ratio of 0.86x, and a P/B (price to book) ratio of 1.23x. At its last earnings call, EPC surpassed analysts’ expectations, reporting EPS of $0.98 per share vs. $0.81 per share as expected (a 20.70% surprise) and winning by a margin of 0.89% on revenue. EPC also reported year-over-year revenue growth (+4.20%), net income (+72.13%), EPS (+77.19%), and net profit margin (+65.24%). EPC has an annual dividend yield of 1.60% and a quarterly payout of 15 cents ($0.60/year) per share. With a modest 10-day average volume of roughly 303 thousand shares, EPC has an average price target of $47, with a high of $53 and a low of $37; this range suggests a more than 40% jump in pricing from where it currently sits. 

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Picking the wrong stocks can decimate your portfolio.

They’re pure portfolio poison.  

But the right stocks…

If you pick the right stocks, you could find yourself jumping for joy on top of an enormous pile of cash.

With over 4000 tickers to choose from, finding the right at the right time can prove to be nearly impossible… 

Unless you’re spending hours each day combing the markets and researching companies.  

That’s why we’ve done the legwork for you.  

We sort through thousands of stock ideas and whittle them down to a few top choices primed for solid price action in the coming days, weeks, and months.  

This week, we’ve narrowed it down to three stocks that could be getting significant attention in the near future.

Click here for the full story on the stocks we’re watching this week… 

NVR (NVR)

Warren Buffett is one of the most successful investors on Wall Street. The Berkshire Hathaway CEO is known for a long track record of market-beating returns. Considering his stellar performance, investors may want to take a page out of Buffett’s playbook and consider striking up a position in NVR.

On Monday, Berkshire Hathaway disclosed a new investment in the leading home builder. The investment was disclosed in a regulatory filing that detailed Berkshire’s U.S.-listed stock holdings, which comprise most of its $353.4 billion equity portfolio, as of June 30.

The Q2 stock purchase was made during a down period for homebuilders as rising interest and mortgage rates slowed demand. But Berkshire said those effects have been partially offset by new construction activity resulting from low inventory of existing homes for sale, an environment that could benefit homebuilders. Berkshire said that as of June 30, it owned about 11,112 NVR shares worth $70.6 million.

Despite recent challenges, NVR has a strategic edge for long-term growth. The company’s mature market focus and careful lot acquisition approach form a robust base for resilience and expansion. By sourcing finished lots through Lot Purchase Agreements (LPAs), NVR mitigates land ownership risks and development costs. This not only reduces market vulnerabilities but also enhances inventory turnover, bolstering returns. Beyond its established lot acquisition strategy, NVR is exploring alternatives, including joint ventures and direct land development, to capitalize on opportunities.

Perhaps Berkshire’s new stake is a bet that interest rates will fall and the home-buying frenzy will resume. The pros on Wall Street give NVR a median price target of $6160, implying around 10% upside over the coming months.  

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Enbridge (ENB)

The spotlight has turned toward prominent Canadian energy transportation firm Enbridge due to its perceived undervaluation, evidenced by a 13.68% dip over the past year against a consensus price target that indicates plenty of room for growth.

Enbridge holds a significant position as a blue-chip dividend stock, boasting a substantial 7.2% yield. Notably, Enbridge is dedicated to delivering value to its shareholders, having accumulated savings of $1.2 billion since 2017. With a BBB+ credit rating, the company assures stability within the dynamic energy sector. Moreover, Enbridge’s historical resilience and strategic approach to debt utilization for capital investments contribute to its overall stability. The company’s strategic emphasis on natural gas aligns well with the evolving energy landscape, making it a potentially promising avenue for investors seeking to enhance their investment foundation.

Enbridge’s distinction among oil stocks stems from its expansive North American pipeline network. While recent stock fluctuations have occurred, the company’s fundamental role in energy infrastructure, coupled with a moderate buy consensus, hints at an appealing 18% upside potential for investors considering this opportunity.

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General Motors (GM)

Amidst the challenges faced by the auto industry, astute investors might find hidden,  long-term gems among cheap stocks. General Motors boasts a portfolio of iconic car brands, ranging from Chevrolet to Cadillac. However, macroeconomic headwinds and the rising momentum of electric vehicles (EVs) have somewhat dimmed the company’s appeal.

Yet, GM could prove to be a surprise contender in the EV race. With a goal to offer exclusively EVs by 2035, it has emerged as the second-largest EV provider in the US. Although the company carries significant debts, its growth ambitions and strong free cash flow position provide hope for a positive outcome.

GM also presents a contrarian play within the automaker landscape. While many investors anticipate a global economic slowdown that might deter consumers from big purchases like new cars, there are contrasting views suggesting a softer-than-expected landing. Such an outcome could uplift auto stocks, including GM, presenting an opportunity for discerning investors.

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Picking the wrong stocks can decimate your portfolio.

They’re pure portfolio poison.  

But the right stocks…

If you pick the right stocks, you could find yourself jumping for joy on top of an enormous pile of cash.

With over 4000 tickers to choose from, finding the right at the right time can prove to be nearly impossible… 

Unless you’re spending hours each day combing the markets and researching companies.  

That’s why we’ve done the legwork for you.  

We sort through thousands of stock ideas and whittle them down to a few top choices that are primed for solid price action in the coming days, weeks, and months.  

This week, we’ve narrowed it down to three stocks that could be getting significant attention in the near future.

Meta Platforms (META)

Meta seems to have rediscovered its momentum, which bodes well for investors. Following a challenging 2022, the parent company of Facebook and Instagram has witnessed its stock price surge by 145% this year. The company is steering away from the metaverse, adopting cost-cutting measures, and emphasizing its focus on artificial intelligence (AI). In the wake of the impact of high interest rates, META stock is now indicating a robust return to growth, positioning it as one of the potential stocks to make investors millionaires.

Furthermore, the social media powerhouse has recently released financial results revitalizing confidence in the company and its shares. After the Q2 earnings report, META stock soared by 8%, fueled by earnings per share of $2.98, exceeding the projected $2.91 estimated by analysts. The company generated $32 billion in revenue, surpassing consensus predictions of $31.12 billion. This growth is attributed to a rebound in digital advertising across its social media platforms. Q2 revenue experienced an 11% surge from the previous year, marking the first time the company has reported double-digit growth in this domain since the conclusion of 2021. It might just be the right time to consider a purchase.

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Enbridge (ENB)

The spotlight has turned toward prominent Canadian energy transportation firm Enbridge due to its perceived undervaluation, evidenced by a 13.68% dip over the past year against a $45.11 consensus price target.

Enbridge holds a significant position as a blue-chip dividend stock, boasting a substantial 7.2% yield. Notably, Enbridge is dedicated to delivering value to its shareholders, having accumulated savings of $1.2 billion since 2017. With a BBB+ credit rating, the company assures stability within the dynamic energy sector. Moreover, Enbridge’s historical resilience and strategic approach to debt utilization for capital investments contribute to its overall stability. The company’s strategic emphasis on natural gas aligns well with the evolving energy landscape, making it a potentially promising avenue for investors seeking to enhance their investment foundation.

Enbridge’s distinction among oil stocks stems from its expansive North American pipeline network. While recent stock fluctuations have occurred, the company’s fundamental role in energy infrastructure, coupled with a moderate buy consensus, hints at an appealing 18% upside potential for investors considering this opportunity.

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Accenture (ACN)

Recent developments have spotlighted the synergistic collaboration between Accenture and Nvidia, culminating in the launch of AI Lighthouse, harnessing Nvidia’s formidable AI supercomputing expertise. It’s evident that Accenture is not merely riding the AI wave but is also setting a trailblazing pace for others in the industry.

Accenture has showcased remarkable performance in 2023, marking a surge of approximately 16% year-to-date. This growth trend is solidifying its position as a compelling machine learning stock, catching the attention of many astute investors.

The recent release of third-quarter fiscal 2023 earnings has only reinforced this positive outlook. A robust revenue of $16.56 billion, exhibiting a 2.5% year-on-year increase, in combination with a net income of $2.01 billion, reflecting a substantial 13% growth, underscoring the company’s operational prowess. Moreover, the diluted earnings per share (EPS) have significantly expanded by 13%, surpassing expectations by an impressive margin of 5%.

Accenture’s proactive endeavors in the realm of AI and machine learning have been garnering significant attention. For investors with a discerning eye on high-potential machine learning stocks, Accenture is effectively illuminating the path toward a transformative AI-driven future.

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It’s hard to argue with the fact that right now, there is a pretty potent sense of uncertainty in the media regarding where exactly the U.S. economy stands. This isn’t necessarily a unique phenomenon, as there will always be bears where there are bulls, doves where there are hawks, and vice versa. 

Regardless, 2023 has thus far been a fascinating year. Although the unveiling of ChatGPT undoubtedly led to an enormous (and ongoing) tech rally, it’s not solely generative AI’s prowess that compels. 

We need to remind ourselves that we should always be eyeing the broader market; keeping our portfolios diversified is critical. Compelling profits can be found just about anywhere… 

MGM Resorts International (MGM) 

MGM Resorts International (MGM) is a well-known name that operates diverse recreation venues, including casinos and resorts in the United States and Macau. With three key segments—Las Vegas Strip Resorts, Regional Operations, and MGM China—MGM recently surpassed Q2 estimates with an EPS of $0.59 per share vs. $0.52 per share as expected, a 13.94% surprise, and revenue of $3.94 billion, exceeding analyst expectations by 3.75%. Benefiting from its increasingly thriving Vegas properties and China’s reopening, MGM is a prime summer stock, ripe for the picking (as I’ll illustrate a little more). 

As it maintains affordable pricing, MGM has been trading around the middle of its existing 52-week range, is currently up year-to-date by 36.53%, and holds a P/S (price to sales) ratio of 1.18x with $1.34 billion in free cash flow. In addition to beating the analysts in Q2, MGM reported year-over-year growth in revenue (+20.76%) and operating income (+181.06%), and it is forecasted to report $3.8 billion in sales at $0.55 per share for the current quarter. MGM pays a dividend, albeit modestly, with an annual yield of 0.02% and a payout of $0.01 per year. With a 10-day average volume of 5.43 million shares, MGM has an average price target of $59.50, with a high of $69 and a low of $46, representing enough room for more than 50% upside potential. MGM has 12 buy ratings and six hold ratings. 

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Topgolf Callaway Brands Corp (MODG) 

One stock fitting for this list, sticking out for its enormous upside potential, is Topgolf Callaway Brands (MODG). A global leader in the golf industry MODG creates equipment, clothing, and accessories. Operating globally, including the U.S., Europe, and Asia, MODG’s three primary segments are Topgolf, Golf Equipment, and Active Lifestyle. MODG recently reported Q2 results that exceeded Wall Street analysts estimates with an EPS of $0.39 per share vs. $0.34 per share as expected, a 14.68% surprise. As the summer season boosts recreational interest, MODG’s venues anticipate heightened demand, supported by ongoing venue expansions to tap into the sport’s growing popularity. 

MODG’s stock is currently down year-to-date by 14.13% and trading near the bottom of its 52-week range, has a PEG (price/earnings to growth) ratio of 0.71x, a P/S ratio of 0.89x, and a P/B (price to book) ratio of 0.91x. MODG also reported year-over-year revenue growth of 12.23% in addition to outdoing analysts’ estimates. For the current quarter, it is projected to report $1.1 billion in sales at $0.29 per share. With a 10-day average volume of 2.95 million shares, MODG has a median price target of $28.50, with a high of $56 and a low of $16; this indicates the potential for a whopping 230% price jump from where it currently sits. MODG has 12 buy ratings and two hold ratings.

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Delta Air Lines Inc (DAL) 

Last but not least, Delta Air Lines (DAL) offers both passenger and cargo air travel on a vast scale. Divided into airline and refinery segments, DAL shines as a prominent name in American aviation, aligning well with 2023’s summer travel surge. Impressively, DAL’s Q2 results surpassed analysts’ predictions with an EPS of $5.03 per share and revenue of $14.18 billion, outdoing estimates by measures of $0.97 per share and $251.59 million, respectively. At the latest earnings report, 56 hedge funds displayed bullish sentiment towards DAL, up from 51 in the previous quarter. Among them, GMT Capital holds a substantial position in DAL’s stock, holding over 6.2 million shares valued at $217 million. 

Currently up by 37.02% year-to-date, DAL comes with a healthy 0.57x PEG ratio, a positive 20/200 day SMA (simple moving average), a P/S ratio of 0.53x, with a TTM (trailing twelve-month) momentum growth measure of 35.96%, and an operating free cash flow of $6.9 billion. DAL not only pulled an upset on analysts in Q2 regarding earnings forecasts but reported year-over-year revenue growth (+12.69%), net income (+148.57%), EPS (+146.96%), and net profit margin (+120.49%). For the current quarter, DAL is projected to post $14.5 billion in sales at $2.37 per share. DAL has an annual dividend yield of 0.89% with a quarterly payout of 10 cents ($0.40/year) per share. With a 10-day average volume of 7.32 million shares, DAL has an average price target of $60, with a high of $77 and a low of $53; this represents a strong upside potential of over 71%. DAL has 20 buy ratings from analysts (and zero holds). 

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