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Walmart’s stock was one of the retail sector’s five worst performers in the first half of 2021.
Getty Images/Joe Raedle
While 2021 is more than halfway done, the retail sector is likely to experience even more turmoil. Consumers are loaded with cash, looking to refresh their outfits when businesses and schools reopen, and are continuing pouring money into their homes, which has boosted retail companies in recent months. Furthermore, the meme trade is primarily focused on consumer-oriented names, which has caused several companies to surge. It’s hardly shocking that
GameStop
In the first half of the year, (ticker: GME) topped the list of the best-performing merchants.
However, not every stock is a winner. The worst performers for the first six months of 2021 are listed below. Holdings of Grocery Stores The Grocery Outlet stock (GO) began trading in mid-2019 and has had a lot of success so far. Unlike other supermarkets, such as Albertsons, however (ACI),
Kroger
& (KR)
Farmers Markets at Sprouts
(SFM), which are all up more than 20% year to date—the stock has underperformed in the first half of 2021, falling roughly 12%. That’s a sharp turn of events after a great showing during the Covid-19 pandemic. When the company reported weaker-than-expected first-quarter sales in mid-May, the stock dropped by double digits. Grocery Outlet is expected to earn 97 cents a share this year, down from $1.14 the prior year, according to experts. Grocery Outlet is favored by 40% of FactSet’s 15 analysts who monitor the stock, while 60% are neutral. The average analyst price estimate for the stock is $40.21, up from approximately $35 recently. Dollar Tree Dollar Tree Dollar Tree
(DLTR) is the second poorest performer in the first half of 2021, with a drop of about 8%. The corporation struggled more than its competitors.
Dollar General is a store that sells a
(DG) during the epidemic since it has more seasonal and discretionary items. Despite the fact that consumers grew to prefer such areas, the stock has struggled. In late May, Dollar Tree shares took a hit when the firm issued poor forecasts and warned of the impact of rising freight costs. Half of the 28 analysts who cover the stock are neutral, while 46% rate it as a Buy or higher; there is only one bearish call on the Street. The stock finished at $99.45 on Friday, with an average analyst price target of $117.09. Dollar Tree is expected to earn $5.97 per share for the whole calendar year, up from $5.58 the prior year, according to consensus. La-Z-Boy Inc. (LZB) shares have down 5% in the first six months of the year. Earlier this year, the company had a CEO transfer, which coincided with a boom in furniture sales. However, when the retailer warned of rising expenses and supply chain interruptions, the stock dropped by double digits. La-Z-Boy is expected to earn $2.84 per share in calendar 2021, up from $2.47. Two of the three analysts who cover the stock rank it as a Sell, while the third is neutral. In comparison to Friday’s closing price of $37.18, the average analyst price objective is $50. Walmart
Walmart
In the first half of 2021, the stock (WMT) declined a bit more than 3%. Early in the year, the stock’s shares were knocked down by a profit miss and a gloomy outlook. While the stock received a boost from the mega-most retailer’s recent earnings report, it has yet to return to where it was at the start of the year. As stimulus funds run out, some investors may be concerned about rising labor expenses (which is a concern for the entire sector) or slowing growth for Walmart’s+ subscription service. Walmart is expected to earn $5.88 per share in 2021, according to analysts. Nearly three-quarters of the 37 analysts that follow the stock give it a Sell rating, while just over 20% give it a Hold or similar rating. Two analysts are pessimistic. In comparison to Friday’s closing price of $140.11, the average price goal is $162.82. TJX Corporation is a retailer that sells a variety of goods. TJX (TJX), the parent company of TJ Maxx, saw its stock drop less than 1% in the first half. Considering the off-price retailer’s lack of an online presence, the merchandise held up quite well during the epidemic. Despite a good earnings report, the stock plummeted in mid-May. Despite this, Wall Street is bullish on the stock, with more than 80 percent of the 27 analysts that cover TJX giving it a Buy or higher rating. There’s a bear on the Street, and 15% of the population is on the sidelines. The stock finished at $68.25 on Friday, with an average analyst price target of $78.83. To contact the editors at Barron’s, send an email to editors@barrons.com./n
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