Retailers are overhauling their operations as technology redefines the shopping experience. Still, demand can be volatile as the industry is exposed to the ups and downs of consumer spending. This has stirred some uncertainty lately as retail stocks have lagged the market over the past six months, posting a return of 12.5% compared to 20% for the S&P 500.
Despite the lackluster result, a few diamonds in the rough can produce earnings growth no matter what, and we started StockStory to help you find them. Taking that into account, here are two resilient consumer stocks at the top of our shopping list and one that may face trouble.
One Consumer Retail Stock to Sell:
America's Car-Mart (CRMT)
Market Cap: $181.6 million
With a strong presence in the Southern and Central US, America’s Car-Mart (NASDAQ: CRMT) sells used cars to budget-conscious consumers.
Why Do We Avoid CRMT?
- Lagging same-store sales over the past two years suggest it might have to change its pricing and marketing strategy to stimulate demand
- Earnings per share have dipped by 30.7% annually over the past five years, which is concerning because stock prices follow EPS over the long term
- 16× net-debt-to-EBITDA ratio shows it’s overleveraged and increases the probability of shareholder dilution if things turn unexpectedly
At $22.21 per share, America's Car-Mart trades at 9.9x forward P/E. Read our free research report to see why you should think twice about including CRMT in your portfolio.
Two Consumer Retail Stocks to Watch:
Abercrombie and Fitch (ANF)
Market Cap: $3.30 billion
Founded as an outdoor and sporting brand, Abercrombie & Fitch (NYSE: ANF) evolved to become a specialty retailer that sells its own brand of fashionable clothing to young adults.
Why Do We Like ANF?
- Comparable store sales rose by 13.5% on average over the past two years, demonstrating its ability to drive increased spending at existing locations
- Unique assortment of products and pricing power are reflected in its best-in-class gross margin of 63.6%
- Earnings growth has trumped its peers over the last six years as its EPS has compounded at 48.1% annually
Abercrombie and Fitch is trading at $68.90 per share, or 7.1x forward P/E. Is now the right time to buy? See for yourself in our in-depth research report, it’s free for active Edge members.
Boot Barn (BOOT)
Market Cap: $5.84 billion
With a strong store presence in Texas, California, Florida, and Oklahoma, Boot Barn (NYSE: BOOT) is a western-inspired apparel and footwear retailer.
Why Are We Fans of BOOT?
- Aggressive strategy of rolling out new stores to gobble up whitespace is prudent given its same-store sales growth
- Brick-and-mortar locations are witnessing elevated demand as their same-store sales growth averaged 2.9% over the past two years
- Notable projected revenue growth of 13.7% for the next 12 months hints at market share gains
Boot Barn’s stock price of $187.30 implies a valuation ratio of 2.5x forward price-to-sales. Is now the time to initiate a position? Find out in our full research report, it’s free for active Edge members.
Stocks We Like Even More
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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