Why Target, Costco Stocks are Booming in 2019 Ahead of Black Friday

Ahead of post-Thanksgiving Black Friday, stocks of major retailers like Walmart, Target, and Costco are up nearly 50% this year, on average.
Target, Costco, Walmart, Black Friday
A Target billboard lights up Times Square in a yer where the stock has gained over 50%
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  • Black Friday begins today and record-high numbers are expected.
  • Walmart, Target, and Costco are up over 50% year-to-date on average.
  • Consumer spending is set to remain high as the stock market sentiment continues to improve.

Black Friday is set to begin in a few hours and ahead of the post-Thanksgiving celebration, stocks of major retailers like Walmart, Target, and Costco are up nearly 50% year-to-date.

Since January 1, 2019, Walmart, Target, and Costco stocks surged by 27%, 90%, and 54.4% respectively, by 54.4% on average.

The strong rally of the three retail stocks indicate a significant rise in consumer spending, possibly fueled by the tax cuts in the U.S., progress in the U.S.-China trade deal, and the bull market of U.S. stocks.

Record high Black Friday?

Some states like Florida are already expecting record-high sales based on data from the Florida Retail Federation. Consumers are anticipated to spend 4% more compared to last year, further raising the demand for Black Friday.

According to the National Retail Federation president and CEO Matthew Shay, consumer demand remains strong as the U.S. economy continues to expand.

The expectations of the U.S. stock market to maintain its momentum throughout the year’s end is likely to provide retailers like Walmart, Target, and Costco with an active holiday season including Black Friday and Christmas.

Shay said:

The U.S. economy is continuing to grow and consumer spending is still the primary engine behind that growth. Nonetheless, there has clearly been a slowdown brought on by considerable uncertainty around issues including trade, interest rates, global risk factors and political rhetoric. Consumers are in good financial shape and retailers expect a strong holiday season.

During the week, major mobile and web platforms of retailers saw unexpected spikes in traffic, overloading servers with excessive demand

Costco, for instance, saw its mobile app and website clogged for hours, as it allowed consumers to purchase items with a Black Friday discount ahead of November 29.

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Walmart also saw a large portion of its major deals become immediately sold out within minutes on its online platform, infuriating shoppers who have been waiting for Black Friday.

Can Walmart, Target, and Costco stocks continue to thrive?

Earlier this month, Target CEO Brian Cornell said that the company sees a “very healthy consumer environment,” expecting consumer spending to remain high.

While most large retailers like Macy’s have struggled throughout 2019, companies that have focused on improving their e-commerce platforms as well as in-house shopping experience have rallied ahead of Black Friday.

target stock black friday
Target spikes 56.6% year-to-date ahead of Black Friday (source: Yahoo Finance)

Cornell said:

Looking ahead, we have ushered in the holiday season with an unwavering commitment to guest service that complements our highly differentiated, value-driven assortment, our exceptional in-store shopping experience as well as an unmatched suite of easy and convenient fulfillment options.

Major retail stocks look to end 2019 on a stronger footing than last year, as the inflow into the equities market further intensifies.

Samburaj Das edited this article for CCN - Capital & Celeb News. If you see a breach of our Code of Ethics or find a factual, spelling, or grammar error, please contact us.

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