Counting Down to Black Friday

Congratulations: we’ve just entered the most wonderful week of the year!

It’s the week where piles of sales fliers are shoved in your mailbox with 50% of this, 60% off that and are a 100% pain-in-the-butt to recycle. It’s the week when your email inbox is flooded with more sales ads than friendly correspondence received at any other time of the year. Buy this, shop here, traffic jams galore – it’s the commencement of a new season of unbridled consumerism at the same time people are celebrating and giving thanks for all the blessings in their life.

Black Friday really excited me when I was a kid because I would head to the mall with my mom at 8 in the morning and pick through the obliterated shelves at Kaufman’s for unique gifts to give the rest of the family. Nowadays I’m content to sprawl out on the sofa in a turkey-induced coma and watch football. However, I’m not “most Americans” and it’s a certainty that many will be flocking to malls (and their laptops) this week in an effort to save some money.

As hundreds of companies make their giant push at year’s end to turn their sales from the red into the black (hence the term Black Friday), I highly encourage you to partake in their success by owning stock in quality retail names. Despite a troubled economy, consumers will continue to bust out their credit cards, evidenced by numerous sales previews. Retailers have set themselves up for success in the last few quarters and analysts are optimistic for another quarter of record earnings. While many get their seasonal workouts dodging mall shoppers, you can’t ignore Cyber Monday and the ease at which consumers are extending the season online.

My ultimate hope is to shed some optimism on the fact that despite a still troubled economy, retail stocks should post strong sales results this holiday season and their stocks should outperform the broader market.

Get Your Thanksgiving Meal “To Go”

It seems like the kids will have to entertain themselves as the ladies in their family head to the malls after dinner and the guys pass out in front of the football game -- I will be watching my Minnesota Vikings no matter where I am this year.

It’s hard to say if this will become the new norm, but retailers are majorly milking the shopping season for all its worth. It’s undeniable the planning and effort retailers have gone through to make this shopping season a successful one:

• The National Retail Federation RF expects retail sales in November and December (excluding autos, gas and restaurants) to increase a solid 3.6 percent to $655.8 billion.

• Online sales are forecast to increase between 7 and 10 percent over last year to as much as $117 billion.

• Retailers are expected to hire between 640,000 and 690,000 seasonal workers this holiday season, in line with last year’s 675,300 holiday positions.

• The 2015 holiday season provided tough obstacles for the retail industry including weather and inventory challenges. Average spending per person during the holiday season was over $800 for the second year in a row, with more than half of shoppers splurging on non-gift items for themselves. Barbie was back in the number one spot on the Top Toys list after falling behind Disney’s Frozen in 2014, following an 11-year reign.

Source: National Retail Federation.