Get on board the year-end rally with some retail therapy, says Marc Chaikin, founder of Chaikin Analytics but, as with all investment, be selective.

“I love the conversations on the retail space,” he said while appearing on Benzinga’s Premarket Prep on Thursday.

But he’s not thinking of the value stores, such as Dollar General (NASDAQ:DG), which just reported stronger-than-expected third-quarter earnings on Thursday.

“DG still has a bearish grading and it’s been underperforming for so long that I wouldn’t touch that,” he said.

There are three retail-related stocks he loves, however:

1. Etsy (NASDAQ:ETSY) – the online marketplace
2. Shopify (NYSE:SHOP) – the Canadian e-commerce group
3. Block (NYSE:SQ) – the retail payments company

Talking of market entry levels, Chaikin said, “you can go out and grab Etsy and Block right now.” Shopify currently trades at levels where it’s best to wait until its shares come down a little, he added.

“Everywhere I went to do my holiday shopping — the shopping cart was Shopify — they’re doing nice tie-ins with analytics companies. The same thing is true with Block,” he said.

Also Read: Dollar General, Ollie’s Shares Fall: Analysts Positive On Results, Investors Take Profits

Good Environment for Banks

Chaikin also likes a number of “conservative” banks. “I think we have a wonderful interest rate environment for the banks — financials have been amazing for two months.”

His picks in this sector are:

1. PNC Financial Services Group (NYSE:PNC) – the Pittsburgh-based bank and asset manager
2. Bank of New York Mellon (NYSE:BK) – the NYC-based financial services company
3. Truist Financial Corp (NYSE:TFC) – the Carolina-based banking and asset management company

“I’d stay away from the bigger players — there’s more juice in these names and less exposure to the international front on trading desks,” Chaikin said.

Where’s The Overheating?

Healthcare is a really tough place to be at the moment, Chaikin cautioned. He also suggested avoiding the tech stocks at the moment.

“I’ve seen traders come in and buy weakness in tech stocks, but you can’t really touch tech until it pulls back.”

Watch the entire interview with Marc Chaikin on Benzinga’s Premarket Prep below.

Now Read: Why Is Shopify Stock Trading Lower Wednesday?

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