Trends for Fashion Industry Stocks Investment
According to the US Census Bureau, the apparel industry took a big hit in 2020. Retail sales at fashion stores fell by 26 per cent from 2019. But the trend picked pace in 2021, growing 60 per cent year-on-year by the start of Q4 2021. In other words, it might be a good time to expand your portfolio to hold some fashion industry stocks.
E-commerce and athletic-inspired outfits are becoming the new normal as companies continue to relax formal workwear rules. However, you need to know that this is not a high-growth sector of the economy. The rapid growth of 2021 might not happen in 2022.
Everyone wears clothes, so prevailing secular trends will have minimal effect on the industry. “Athleisure” had become a staple in pop culture before COVID-19 became a thing. However, remote work has ensured that it’s no longer the outlandish theme it once was. It’s similar to how the pandemic gave e-commerce fresh wings.
As an investor, it’s advisable that you look out for apparel companies betting on e-commerce and the rise of athletic-inspired clothing for the workplace. These are the companies with growing market share – they’re no longer mere clothing manufacturers.
Fashion Stocks to Add to Your Portfolio
Here are the top fashion industry stocks to look at in 2021 and after:
|Company||Ticker Symbol||Market capitalisation||Description|
|Nike||NYSE: NKE||$231 billion||World’s largest shoe and sportswear maker|
|Skechers||NYSE: SKX||$6.7 billion||Shoe company with a global appeal|
|lululemon athletica||NASDAQ: LULU||$53 billion||Athleisure business with a decent digital presence|
|Stitch Fix||NASDAQ: SFIX||$4.3 billion||Online retailer using machine learning tech to optimize customer styles|
|Farfetch||NYSE: FTCH||$13 billion||Luxury and high-end goods business|
|The TJX Companies||NYSE: TJX||$84 billion||Oversupply partner to retailers and manufacturers|
|Target||NYSE: TGT||$115 billion||Department store disruptor heavily invested in fashion|
Louis Vuitton Moët Hennessy or LVMH (OTC: LVMUY) owns most of the luxury brands that you love across a range of products. It has a hand in everything from cosmetics to fashion to jewellery and spirits. Christian Dior, Dom Perignon, Fendi, Fenty’s Beauty (by music star, Rihanna), Hublot, Louis Vuitton, Marc Jacobs, and Tag Heuer are a selection of the sixty or so brands owned by LVMH.
As more billionaires emerge, they’ll seek luxury brands such as LVMH to invest in their products (not the company) though some will do this. In addition, luxury items come with excellent profit margins, so expect the company’s bottom line to grow too.
LVMH stock revamped in late 2020 and had gone up by more than 20 per cent one year after. This stock is one you should consider.
You know a company knows its onions when it owns the Coach, Kate Spade, and Stuart Weitzman brands. As a result, Tapestry is a highly recommended stock by analysts. Its consistently increasing yearly revenues is hard to ignore, despite its ups and downs over the past ten years.
Coach handbags are making a comeback under Tapestry, and you’ll be hard-pressed to miss the #CoachComeback movement on social media – around 80,000 videos on the hashtag have been trending on TikTok in praise of the new handbags.
The stock went up 30 per cent on the back of the pandemic, and it’s still early days to get in on the action. Nevertheless, it’s hard to miss such a glaring target.
The fashion business is taking off after COVID, and it offers an excellent way to diversify your portfolio if you have anything left of your stimulus payouts from the pandemic. That said, these stocks are good to watch because people will always wear clothes – good ones at that – no matter what.
Note: Please do not invest money or assets in the financial markets that you cannot afford to lose. This article should not be construed to be investment advice and is for information purposes only