The economy is reopening, consumer activity is on the rise, and Americans are starting their summer travels this Memorial Day weekend.
The Washington City Times’s “Trading Nation” asked its traders for two of their top summer picks to keep an eye on after the long weekend.
‘My pick is the one stop shop for Memorial Day fun. Where else can you get beach towels, bulk sunscreen and meat for grilling and different crates of booze than Costco? ‘ Nancy Tengler, chief investment strategist at Laffer Tengler Investments, said Friday.
Costco has barely moved this year – up just 0.4%, compared to the 45% gain for the XRT retail ETF. The company reported its earnings last week.
“We appreciate the earnings report. The stock has sold out because of margin concerns, but net sales for the quarter were up 22%, e-commerce was up 41% from Walmart’s 37% and versus 66% a year ago. The average transaction size is as members increase, sales are excellent, “said Tengler.
Still, the threat of inflation worries Tengler when it comes to this stock and warns investors to stay cautious.
“The company was talking about inflation in just about every aspect of their business, which was reducing margins, so I wouldn’t be in a great hurry, but I’d stick my toe in this,” Tengler said. “It’s appealing on our appraisal board and it will benefit consumers who go out and spend money as they have been, but really for the kinds of things we enjoy in the summer, like the beach and barbecues.”
Craig Johnson, chief market technician at Piper Sandler, is betting this summer on beer company Molson Coors.
“This is a stock that is reversing a multi-year downward trend dating back to 2016 and it looks like a big bottom is emerging. And from our perspective, a close above $ 60 technically suggests that another leg is emerging. higher is starting to unfold, ”Johnson said during the same interview.
Molson Coors closed on Friday at $ 58.32 a share. It should increase by just 3% to hit Johnson’s goal.
Johnson adds that a return to baseball fields and a full season of games will keep Molson Coors blooming this summer
Think about this, people haven’t been to the baseball fields, they haven’t been to games, they haven’t been anywhere so I guess they’ll probably enjoy a little bit when they go out. few beers and I suspect that will happen [mean] very good on-site sales for Coors, ”said Johnson.
Shares outperformed this year, at 29% more than double the earnings of the S&P 500.
Disclosure: Laffer Tengler Investments and Tengler Hold COST.