3 Cheap Retail Stocks to Scoop Up Now

NYSE: LL | Lumber Liquidators Holdings Inc. News, Ratings, and Charts

LL – Retail stocks are particularly interesting as they are benefitting from strong consumer spending, rising wages, and the economy reopening. Patrick Ryan identifies 3 cheap retail stocks worth buying: Lumber Liquidators Holding (LL), AutoNation (AN), and Macy’s (M).

The bull case for retail stocks is quite obvious. Like so many activities, there is pent-up demand for people to go to stores and shop. Consumer spending is at record highs and will remain elevated due to rising wages and strong growth.

 

Further, household balance sheets are in great shape and indications of financial stress are at low levels which indicates more room for expansion. On top of these, many retail stocks are quite cheap.

 

Below, we shine the spotlight on three retail stocks priced at solid value points heading into the summer of 2021: Lumber Liquidators Holding (LL)AutoNation (AN), and Macy’s (M).
 
LL

LL is a hardwood flooring specialist. The company has one of the industry’s largest prefinished/unfinished hardwood floor inventories around. LL carries all different types of flooring, each of which is purchased from providers that perform sustainable harvesting.

LL has a forward P/E ratio of 16.32, meaning it is fairly valued at around $21.92 per share. The stock has a high beta of 2.49 indicating it is likely to fluctuate should the market undulate. LL is currently priced about $14 below its 52-week high of $35.10. The stock’s 52-week low is $11.43.

LL has a POWR Rating grade of A. The stock has As in the Value and Momentum components. LL also has Bs in the Quality and Growth components of the POWR Ratings. Click here to find out how LL grades out in the Sentiment and Stability components.

LL is ranked third of the 65 stocks in the Home Improvement & Goods space. You can learn more about the stocks in this sector by clicking here. As a whole, the sector has an A POWR Rating grade.

The analysts are bullish on LL, setting an average target price of $25.33. If the stock increases to this price point, it will have popped by nearly 12%. The analysts’ price target for the stock has increased an impressive $15.13 across the prior year.

AN

AN is the country’s largest auto retailer. AN provides automobile maintenance, repairs, parts, auto protection products, extended service contracts, after-market products, and even extended service contracts. All in all, AN owns and operates more than 300 new automobile franchises in 200+ stores across the United States. As of last year, AN owned more than 70 collision centers, nearly half a dozen used vehicle dealerships, and several auto auction operations spaces.

AN has a forward P/E ratio of 9.19, meaning it is undervalued at its current price level of $94.02. The stock is currently trading about $13 below its 52-week high of $106.99, making the stock’s valuation all the more intriguing. AN has a fairly low beta of 1.64, indicating it will not violently swing up and down should the market become a rollercoaster.

AN has an A POWR Rating grade. The stock has an A in the Value component of the POWR Ratings along with Bs in the Quality, Sentiment, and Momentum components. You can find out how AN fares in the rest of the POWR Rating component grades such as Stability and Growth by clicking here.

AN is ranked in the top five of the 27 stocks in the Auto Dealers & Rentals space, slotting in at number four overall. Click here to learn more about the stocks in the segment. As a whole, space has a B POWR Rating grade.

M

M might be a bit of an antiquated brand yet it is still relevant in 2021. The retail specialist is in the midst of its Polaris Strategy designed to help the company better adjust to the dynamic retail landscape including the shift to the web.

M is currently priced around $4 below its 52-week high of $22.30. However, the stock has a forward P/E ratio of 8.73, indicating it is underpriced. M’s beta is 2.08 so it should prove somewhat volatile if the market undulates.

M has a B POWR Rating grade with Bs in the Quality, Value, and Growth components. M has a C Sentiment grade. Investors can find out how the stock grades out in the Momentum and Stability components of the POWR Ratings by clicking here.

M is ranked 33rd out of the 65 stocks in the Fashion & Luxury category. You can learn more about the stocks in this space by clicking here.


LL shares were unchanged in premarket trading Wednesday. Year-to-date, LL has declined -28.69%, versus a 13.84% rise in the benchmark S&P 500 index during the same period.


About the Author: Patrick Ryan


Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management. More...


More Resources for the Stocks in this Article

TickerPOWR RatingIndustry RankRank in Industry
LLGet RatingGet RatingGet Rating
ANGet RatingGet RatingGet Rating
MGet RatingGet RatingGet Rating

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