Market Overview

Black Friday Experts On 2019 Trends, Why Best Buy Is A Winner

Black Friday Experts On 2019 Trends, Why Best Buy Is A Winner

Thanksgiving Weekend and Black Friday shopping trends are off to a strong start, with some experts predicting holiday sales will increase by an average of $1,000 per consumer.

NRF: Substantial Improvement From Last Year

Holiday sales are expected to increase between 3.8% and 4.2% from last year, which marks a notable improvement from last year's growth of just a "couple of percent," National Retail Federation CEO Matthew Shay said on CNBC's "Squawk Box" Friday.

Last year's holiday season was notable for weakness in the stock market and the U.S. federal government shutdown.

Data from the online universe is just as encouraging. Early estimates from Adobe point to an 18.9% year-over-year increase in online sales Thursday to $4.4 billion, according to CNBC.

Online sales between Nov. 1 and Nov. 27 were also up 16.1% year-over-year as consumers took advantage of discounts and sales that are no longer reserved for Black Friday.

Encouragingly, Adobe is modeling the shopping momentum to continue on Black Friday, with total sales up 20.5% from last year to $7.5 billion. Cyber Monday sales are also expected to be up 20% to $9.4 billion.

Consumers Searching Walmart, Best Buy, Target 

Walmart Inc (NYSE: WMT) is winning Black Friday, as it ranks No. 1 in "most searched Black Friday retail stores" searches over the past week, according to Google Trends.

Coming in second is Best Buy Co Inc (NYSE: BBY), followed by Target Corporation (NYSE: TGT) and Kohl's Corporation (NYSE: KSS).

Home improvement retailer Lowe's Companies, Inc. (NYSE: LOW) ranked fifth, while its much larger rival Home Depot Inc (NYSE: HD) is absent from the list. Home Depot's website suffered from slow load times Thursday.

Google Trends also lists the five most-searched "Black Friday tech" results as follows:

  • AirPods.
  • Apple Watch.
  • Laptop.
  • Nintendo Switch.
  • Oculus Quest.

Potential Winners

Best Buy stands out in the crowded retail segment as a potential winner, Oppenheimer's Alon Rosin said on a CNBC "Trading Nation" segment.

There's "a lot of positivity" within the company as it gains market share from its one-day delivery initiative, he said. 

Investors who are already owners of Best Buy's stock may want to consider buying put options to hedge the long investment, he said.

After all, the stock is up more than 50% since the start of 2019. Investors may want to look at December $77.50 puts that only cost investors around $1.20, Rosin said.

The fashion sector's era of 1990s revival has come to an end, and retailers with heavy exposure to retro could find themselves left out of the retail rally.

Fashion names like Zumiez Inc. (NASDAQ: ZUMZ) and Guess?, Inc. (NYSE: GES) are "showing relatively better staying power," Jefferies analyst Janine Stichter said in a Tuesday note, according to CNBC.

Athletic apparel maker Under Armour Inc (NYSE: UAA) could also survive the death of retro as younger consumers "re-focus on athletic brands," the analyst said. 

Related Links:

3 ETFs For Black Friday

How Has Trading Sentiment Changed In The Retail Sector Ahead Of Black Friday?

Photo by Nicholas Eckhart via Wikimedia. 


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