12-stock shares of the SPDR S&P Retail ETF (XRT), including department store Dillard’s (DDS), fuel seller United States (MUSA) and saleswoman of women’s clothing Chico’s FAS (CHS), have risen more than 10% this year, according to an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. What about Amazon stocks? They are down nearly 41%, shredding hundreds of billions of dollars in market value.
Talk about a role reversal – and one worth noting ahead of a busy week for retailers to report quarterly profit. For years, shares of Amazon.com have soared while the shares of most other retailers have, at best, soared. But the roles have changed this year. The “Death By Amazon” index, which tracks the performance of retailers competing with Amazon, has outperformed Amazon this year, says Bespoke Investment Group, creator of the index. But some retailer stocks are doing even better.
“It’s an interesting question whether the Death By Amazon… (the index is) being punished with Amazon instead of benefiting from the e-commerce giant’s stock price woes,” Bespoke said.
Sizing Retailers in the S&P 500 and Beyond
Finding winning retailers isn’t easy. Only 12% of the 97 stocks in the SPDR S&P Retail ETF have risen 10% or more this year. It’s a challenging environment for retail stocks in general.
The uncertainty in the holiday shopping outlook is moderate spending plans. Inflationary pressure also hurts. Also, fears that a recession is looming or already here don’t help either. The SPDR S&P Retail ETF is down 28.3% this year, trailing the nearly 17% decline in the S&P 500.
And Amazon is one of the ugliest on the index. Not only are the shares plummeting this year, but analysts believe the online retail giant will post a loss this year of 8 cents a share this fiscal year. Last year, it made $3.24 per share. Big physical store rivals are doing better, but not very well. Shares of walmart (WMT) are down more than 4% this year. And Walmart’s profit for this fiscal year is expected to fall nearly 10%.
So who are the winning retailers?
Aren’t department stores dead?
Online retailing got so much attention that no one noticed Grandma was still going to the mall. Shares of Little Rock, Ark., based at Dillard’s, an old-fashioned department store with an online presence, have seen their shares soar more than 47% this year to 361.66.
And it’s not just a speculation game. Analysts believe Dillard’s profit for this fiscal year will rise more than 6%. And that’s after a powerful profit boom in 2022, when it reversed the loss from a year earlier.
Some top performing retailers are easier to understand. With gasoline prices soaring, it’s no surprise to see shares of Murphy USA rise more than 45% this year. The company, which also operates convenience stores at gas stations, is expected to see adjusted earnings growth of more than 80% per share this year.
And then there’s Chico’s FAS, a trendy Florida-based chain of stores known for its clothing for middle-aged women. Wall Street had to rediscover the look, sending stocks up more than 25% this year. Unlike Amazon.com, drowned in red ink, Chico’s is on track to earn 85 cents per share this fiscal year, more than double its earnings in 2022.
On the contrary, 2022 proved to S&P 500 investors that retail is more than Amazon.
Better than Amazon?
Top retail stocks this year in SPDR Retail ETF
|Last name||Teleprinter||Retail type||Stock since the beginning of the year % ch.|
|United States||(MUSA)||Automotive retail||45.2|
|Chico’s FAS||(CHS)||Clothing retail||25.8|
|Casey General Stores||(CASY)||Food retail||18.9|
|Penske Automotive Group||(CAP)||Automotive retail||18.4|
|O’Reilly Automotive||(ORLY)||Automotive retail||16.8|
|Auto area||(AZO)||Automotive retail||16.7|
|Big BJ club||(B.J.)||Hypermarkets & Super Centers||13.7|
|Cabbage growers market||(SFM)||Food retail||13.3|
Sources: S&P Global Market Intelligence, IBD
Follow Matt Krantz on Twitter @mattkrantz
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