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June Retail Sales Beat Forecast: ETF & Stock Winners

Sanghamitra Saha

U.S. retail sales increased 0.4% sequentially in June, breezing past market expectations of a 0.1% rise. Higher purchases of motor vehicles and some other goods led to the beat.

However, the pace of sales growth was same as that of May. As many as 10 of 13 major retail categories showed month-over-month increases. Year-on-year, retail sales growth was 3.4% versus 2.9% increase in the previous month.

With this, growth worries in the United States cooled down a bit. Against this backdrop, we recommend a few ETFs and stocks from areas that saw shining sales in the month.

Motor Vehicle & Parts Dealers

Sales at motor vehicle & parts dealers grew 0.7%, following a similar gain in the previous month.

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First Trust NASDAQ Global Auto Index Fund CARZ

The underlying NASDAQ OMX Global Auto Index of the fund is designed to track the performance of the largest and most-liquid companies engaged in manufacturing automobiles.

AutoZone Inc. AZO

This Zacks Rank #2 (Buy) company is a leading distributor of automotive replacement parts and accessories with stores in the United States, Puerto Rico, Mexico and Brazil. It hails from a top-ranked Zacks industry (top 12%).

Online Stores

Sales from online and mail-order purchases advanced 1.7%, in line with May's gain.

Amplify Online Retail ETF IBUY

The underlying EQM Online Retail Index utilizes a rules-based methodology to select a globally diverse group of companies with 70% or more of online and virtual sales. The fund charges 65 bps in fees (read: 5 Cyclical ETFs & Stocks Top in June).

eBay Inc. (EBAY)

The Zacks Rank #1 (Strong Buy) company is a global commerce leader, which includes our Marketplace, StubHub and Classifieds platforms. The stock comes from a top-ranked Zacks industry (top 21%).

Apparel

Sales at clothing stores grew 0.5% versus 0.2% decline in May.

SPDR S&P Retail ETF (XRT)

The underlying S&P Retail Select Industry Index represents the retail sub-industry portion of the S&P TMI. Apparel Retail takes about one-fourth of the fund (read: Consumer ETFs: Bull Market Winners With Room to Run in 2019).

Buckle Inc. (BKE)

This Zacks Rank #1 company is a leading retailer of medium to better-priced casual apparel, footwear and accessories for young men and women. It comes from a top-ranked Zacks industry (top 40%).

Restaurants and Bars

Sales at restaurants and bars were up 0.9% versus 1% gains in May.

Invesco Dynamic Food & Beverage ETF (PBJ)

Though the fund has a Zacks Rank #4 (Sell) over the medium term, the latest retail sales may give it a boost. The underlying index of the fund — the Dynamic Food & Beverage Intellidex Index — comprises stocks of 30 U.S. food and beverage companies. These are principally engaged in the manufacture, sale or distribution of food and beverage products, agricultural products and products related to the development of new food technologies (read: 5 ETFs to Profit From July Fourth Celebrations).

Chipotle Mexican Grill Inc. (CMG)

The company operates Chipotle Mexican Grill restaurants, which serve a focused menu of burritos, tacos, and burrito bowls (a burrito without the tortilla) and salads with fresh ingredients. The stock holds a Zacks Rank #2 and belongs to a top-ranked Zacks industry (top 35%).

Health & Personal Care Stores

Sales at health & personal care grew 0.5%, after expansion of 0.9% in May.

The Obesity ETF SLIM

The underlying Solactive Obesity Index tracks the performance of global companies focusing on obesity-related diseases, weight-loss programs, weight-loss supplements and plus-sized apparel.

Avon Products Inc. (AVP)

The Zacks Rank #2 company is a leading global beauty company. It comes from a top-ranked Zacks sector (top 14%).

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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
eBay Inc. (EBAY) : Free Stock Analysis Report
 
AutoZone, Inc. (AZO) : Free Stock Analysis Report
 
Avon Products, Inc. (AVP) : Free Stock Analysis Report
 
Amplify Online Retail ETF (IBUY): ETF Research Reports
 
SPDR S&P Retail ETF (XRT): ETF Research Reports
 
Invesco Dynamic Food & Beverage ETF (PBJ): ETF Research Reports
 
First Trust NASDAQ Global Auto Index Fund (CARZ): ETF Research Reports
 
Buckle, Inc. (The) (BKE) : Free Stock Analysis Report
 
Chipotle Mexican Grill, Inc. (CMG) : Free Stock Analysis Report
 
The Obesity ETF (SLIM): ETF Research Reports
 
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Zacks Investment Research
 
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report