Many economists have been predicting a flat holiday sales season in the U.S. due to a weaker economy brought on by higher inflation. So far, however, the long Thanksgiving weekend has been more buoyant than expected.
To begin, Black Friday sales broke $9 billion in sales, which is a record number for the day. According to the head of retail at Salesforce (CRM), consumers are seeking value, as seen in the strong correlation between discount percentages and the resulting online sales.
Wall Street has also weighed in with their thoughts. The footwear and apparel team at research firm Wedbush cited Deckers Outdoor Corp. (DECK) — parent of the UGG shoe brand — as the clearest winner of Black Friday week. Highlights of the report mentioned that UGG was one of the only brands tracked by Wedbush that was less promotional last week versus last year and one of the few that saw growth in online searches. This "suggests that interest in the brand remains high even as most other brands see less robust demand." Other positives include longer-than-usual lines at stores and significant buzz on social media.
Daily Chart of Deckers (DECK)
CHART 1: ON DECK. A gap up in DECK, positive relative strength index (RSI), and positive moving average convergence divergence (MACD) support a potential uptrend in the stock. Chart source: StockCharts.com.
In addition to Decker's UGG brand, the company has a very successful sneaker brand named HOKA, which reached $1 billion in sales in October. The product provides a more supportive and comfortable sole, which has been very popular among middle-aged athletes. The stock gapped up into a base breakout last week and is now in a confirmed uptrend (see chart above).
For those who would like to be alerted to additional stocks in this area as well as top-performing Healthcare, REIT, and Technology stocks, use this link here to receive immediate access to my report from yesterday. This link will provide you with a 4-week trial of my twice weekly MEM Edge Report for $7.
Warmly,
Mary Ellen McGonagle - MEM Investment Research
