17 Labor Day Stock Picks
Labor Day marks the unofficial end of summer. Week-long vacations are done, weekend trips to the lake are winding down, and for sports fanatics, here comes football season.
But there’s a lot of science behind Labor Day. Consumers spend in very predictable ways making this weekend a key revenue driver for those companies in the sweet-spot of Labor Day spending. Here are a few companies to watch on Tuesday.
Gas Prices Are Rising
Because of the tensions in Syria, gas prices are slated to rise. Luckily, it might not be until after the Labor Day holiday that consumers see the Syria-related rise. Still, with so many people taking that final trip, the rising price of gas will be an indicator to watch.
Companies that operate filling stations include BP (NYSE: BP), Hess (NYSE: HES) and oil companies like ConocoPhillips (NYSE: COP), Exxon (NYSE: XOM) and Marathon Oil Corporation (NYSE: MRO) are all well-known names in the space.
If you’re looking for something more speculative, CVR Energy, Inc. (NYSE: CVI) has had a rough year but for value investors looking for a big dividend play, 6.8 percent might be worth some research time. (This is only a $3.8 million company so exhaustive research is necessary before committing money.)
Time to Travel
Labor Day is about one last trip to somewhere. Whether it’s a drive to a relative’s house or a weekend vacation, 34.1 million Americans will travel at least 50 miles this weekend—a 4.2 percent year over year increase. Only eight percent will fly, according to AAA so let’s not include the airline industry.
If you’re the driver, Starbucks (NASDAQ: SBUX) might be your answer to staying awake on the road. If you get to grandma’s house and don’t plan to stay with her, you might head to a Marriott (NYSE: MAR) or if you have more expensive tastes, a Starwood Hotels (NYSE: HOT) property.
AAA says that eating will be the most frequent Labor Day activity so fast food chains like McDonald’s (NYSE: MCD) and Yum! Brands (NYSE: YUM) or for something a little nicer, The Cheesecake Factory (NASDAQ: CAKE), Texas Roadhouse (NASDAQ: TXRH), or Red Robin (NASDAQ: RRGB).
Some people prefer to do some home improvement instead of traveling. That’s why companies like Home Depot (NYSE: HD) and Lowe’s (NYSE: LOW) have aggressive Labor Day sales offering blowout prices on everything from grills to replacement windows. Or a less thought-of name, The Sherwin-Williams Company (NYSE: SHW).
Happy Labor Day!
Disclosure: At the time of this writing, Tim Parker had no position in any of the companies mentioned.
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