E-commerce, over the past few years, has been playing a major role in giving a boost to retail sales during the holiday season. And this year, online spending surged a record high on Black Friday, thanks to the pandemic that kept most people away from stores.
Traffic at stores took a deep plunge and e-commerce was again the saving grace for retailers. The online trend is likely to continue given that more Americans are now comfortable availing of this mode of shopping.
Online Sales Hit New High
According to preliminary data released by Adobe Analytics, Black Friday e-commerce sales jumped 21.6% year over year, as Americans spent a whopping $9 billion shopping online. Online sales had recorded $7.4 on Black Friday in 2019. This also marks the second-largest online spending day in the country’s shopping history, with Cyber Monday 2019 being the best ever.
This Black Friday, consumers spent $6.3 million per minute shopping online on average, or $27.50 per person. Smartphone played a major role in boosting overall online sales, accounting for $3.6 billion of the total amount spent, or 40% of the total online sales. This reflects a 25.3% year-over-year jump.
E-Commerce Driving Retail Sales
E-commerce played a pivotal role in driving sales not only on Black Friday but also Thanksgiving Day. A total of $5.1 billion was spent online on Thanksgiving, marking an increase of 21.5% year over year. Also, $3.47 billion was spent on the Wednesday before Thanksgiving.
According to Adobe’s data, curbside pickup witnessed a 52% year-over-year jump on Black Friday. Toys like Lego and Hot Wheels along with Apple Watch and AirPods were some of the highest selling items. The coronavirus pandemic has played a major role in boosting online sales this year.
Although online shopping was picking up in the United States, it was a laggard compared to many countries. The pandemic changed the entire perception with people opting for this mode out of compulsion. As cases of coronavirus continue to rise, most people are likely to prefer shopping online during the holiday period to avoid exposure to the virus.
Given that virus fears have once again started escalating in the minds of people, online shopping will continue to be a safe bet for millions over the coming months. This is thus the right opportunity to invest in retail stocks that have a strong online presence.
Best Buy Co., Inc. BBY is a multinational specialty retailer of consumer electronics, home office products, entertainment software, communication, food preparation, wellness, health, security, appliances and related services.
The company’s expected earnings growth rate for the current year is 27.8%. The Zacks Consensus Estimate for current-year earnings has improved 9% over the past 60 days. Best Buy presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Target Corporation TGT has evolved from just being a pure brick & mortar retailer to an omni-channel entity. The company has been investing in technologies, improving websites and mobile apps, and modernizing the supply chain to keep pace with the changing retail landscape and better compete with pure e-commerce players.
The company’s expected earnings growth rate for the current year is 35.5%. The Zacks Consensus Estimate for current-year earnings has improved 21.1% over the past 60 days. Target carries a Zacks Rank #2.
Overstock.com, Inc. OSTK is primarily an e-commerce service provider. The company sells its broad range of price-competitive products, including furniture, home decor, bedding and bath, and houseware through its www.overstock.com, www.o.co and www.o.biz websites.
The company’s expected earnings growth rate for next year is 1.8%. The Zacks Consensus Estimate for current-year earnings has improved more than 100% over the past 60 days. Overstock has a Zacks Rank #2.
L Brands, Inc. LB evolved from an apparel-based specialty retailer to a segment leader focused on women’s intimate and other apparel, personal care, beauty and home fragrance products.
The company’s expected earnings growth rate for next year is 0.4%. The Zacks Consensus Estimate for current-year earnings has improved 96.6% over the past 60 days. L Brands sports a Zacks Rank #1.
DICKS Sporting Goods, Inc. DKS operates as a major omni-channel sporting goods retailer, offering athletic shoes, apparel, accessories and a broad selection of outdoor and athletic equipment such as for team sports, fitness, camping, fishing, tennis, golf and water sports.
The company’s expected earnings growth rate for the current year is 58.5%. The Zacks Consensus Estimate for current-year earnings has improved 49.2% over the past 60 days. Dicks Sporting sports a Zacks Rank #1.
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