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10 Stocks Set To Soar From Holiday Shopping

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Dave Nelson / Shutterstock.com

If you have an internet connection, you’ve probably heard about the labor pinch, supply-chain crisis and inflationary pressures that have affected shoppers for two years now. With the 2022 holiday shopping season already in full swing, you’ll have to dig through the noise to find out which companies are best positioned to profit during what remain to be troubled times in terms of delivering goods to consumers. In 2022, some perennial winners are likely to have yet another great season, but some lesser-known companies are also well positioned to make waves.

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Read on to meet some of the stocks that could brighten your holiday and new year if you buy now but remember to consult a financial professional to determine which investments are right for you and your portfolio.

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Amazon (AMZN)

It isn’t the holiday season if you’re not talking about Amazon, one of the greatest stocks of the 21st century and the biggest ecommerce beast on Earth. The world’s largest online retailer has had a quite disappointing year so far and heads into the holidays carrying bearish investor sentiment, which is unusual for the retailing behemoth. But with the stock down over 45% YTD as of Nov. 4, 2022, many analysts see long-term value in the stock. 

In fact, the consensus rating among the 43 analysts covering the stock is “Strong Buy,” and the average 12-month price target is $142.29. This suggests a strong 36% upside over the next year – and a good portion of those gains may come over the next few months, as results of this year’s shopping season roll in. 

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Costco (COST)

Costco is a big box retailer that is something of a breed apart from companies like Walmart and Target. Rather than relying strictly on sales, Costco actually generates a significant amount of its profitability from membership dues, which faithful customers renew at the astonishing rate of 92.6% in the U.S. and Canada. Famous for its low-cost products, $4.99 rotisserie chickens and $1.50 hot dog and soda combos, Costco is likely to generate tremendous sales once again over the holiday season. With the stock trading down about 14% YTD, it could be an opportunity to scoop up shares before holiday revenue numbers come tumbling in. Wall Street analysts expect a 14% gain over the coming year.

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United Airlines (UAL)

The airline industry is bracing for a crush of demand this holiday season — and as one of the big three U.S. airlines, United should be a huge beneficiary. The company bested both earnings and revenue numbers in its most recent quarter, and it’s likely to be even more profitable over the holiday travel season. Company management is forecasting margins and revenue well above previous analyst estimates over the upcoming fourth quarter.

The stock of United Airlines is down just over 2% year-to-date, meaning it’s already been holding up well in a rough year for the overall market. Analysts have a consensus buy rating on the stock, with a 12-month average price target of $56.13, about 32% above current levels.

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TJX Companies (TJX)

TJX Companies is the parent company of a number of popular off-price apparel and home fashion brands, including T.J. Maxx, HomeGoods and Marshalls. The company’s stock has held up relatively well during a tough 2022, down just over 6% year-to-date. As inflation has risen significantly in 2022 and talk of a recession amps up, it is discount brands like T.J. Maxx and Marshalls that may benefit most of all during the upcoming holiday shopping season. Analysts have a strong buy rating on the stock, with an average 12-month price target of $77.25 to go along with its 1.64% dividend.

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Target (TGT)

Both Walmart and Target are on many investors’ Christmas lists this year, and for good reason. Both have long-term container shipping partnerships to help them survive the supply-chain crisis that’s choking the retail industry, and their omnichannel shopping format gives them an edge this year that online-only sellers like Amazon won’t be able to lean on.

Target, however, might just be the better big-box bet. It’s already a consensus “strong buy,” according to analysts, but it’s also taking a completely different approach to sales this holiday season when compared with Walmart. Whereas Target is hiring about 100,000 seasonal workers in 2022 – about the same as in 2021 – Walmart is actually significantly reducing its holiday hiring, using a combination of 40,000 full- and part-time staffers instead of the 150,000, mostly full-time workers it hired in 2021. Time will tell which is the winning strategy, but it appears that Target is gearing up for booming holiday sales.

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Best Buy (BBY)

Like Target and Walmart, Best Buy has the reach and the relationships needed to survive any supply-chain snafus that might try to ruin Christmas — but that’s not the only reason that investors should take note of the country’s top electronics retailer. 

Best Buy has a few arrows in its quiver, however, including its TotalTech program, which costs $199 per year and offers perks such as 24/7 tech support from the GeekSquad and free delivery and installation of Best Buy products. Subscription revenue has become the new gold standard on Wall Street, and the TotalTech program has been growing. Toss in a significant 5.11% dividend and the stock has much to offer, particularly ahead of the holiday selling season.

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iShares Transportation Average ETF (IYT)

The holiday season is shipping season, and the companies that get the goods from the warehouses to the front porches are always a good bet when the weather cools — but you might be hesitant to put all your eggs in one basket. If diversification is important to you, you can own UPS, FedEx, and many other well-known shippers with this exchange-traded fund, including Union Pacific, Norfolk Southern, Kansas City Southern and more. The ETF allows you to buy into all the big dogs in an industry poised for success at the same time with a single stock purchase.

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PayPal (PYPL)

The holiday season is shipping season, and the companies that get the goods from the warehouses to the front porches are always a good bet when the weather cools — but you might be hesitant to put all your eggs in one basket. If diversification is important to you, you can own UPS, FedEx, and many other well-known shippers with this exchange-traded fund, including Union Pacific, Norfolk Southern, Kansas City Southern and more. The ETF allows you to buy into all the big dogs in an industry poised for success at the same time with a single stock purchase.

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Starbucks (SBUX)

It may seem like there’s already a Starbucks on every other street corner, but the popular coffee outlet is continuing to grow at a rapid pace. Starbucks anticipates opening 2,000 new stores in the U.S. alone by 2025, and in China, the company plans on opening a new store every 15 hours for the next five years. That’s simply astonishing growth. Over the holidays, Starbucks does particularly well, as the combination of colder weather and increased foot traffic from shoppers both contribute to boosted coffee sales.

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Hershey (HSY)

Hershey generally sees a pickup in sales over the holidays, as Americans give chocolates in gift baskets and go off their own diets while celebrating. But in 2022, Hershey has been raising its earnings and revenue forecasts as prices rise and demand has still remained strong. The company pays a 1.7% dividend and average price forecasts are currently at $236.85, just 3.4% above current levels. But those price targets are likely to rise in the wake of the company’s most recent earnings report and updated sales estimates.

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Andrew Lisa contributed to the reporting for this article.