Retail Propped up by Only 3 Names

Without them, retail stocks are down.

By Christine Hughes, Canada. Chief Investment Strategist, OtterWood Capital:

Consumer Discretionary has been the best performing sector in the S&P 500 in 2015 (up roughly 10% YTD); however, the rally has been driven by a narrow selection of stocks. This dynamic is most evident in the retail subsector.

When you dig into the stocks leading the S&P retail index, the rally has been dominated by three companies. In the chart below you can see most of the performance in retail can be attributed to Amazon, Netflix and Expedia (blue line). And when you strip out these leaders the index is actually down year to date (red line).

If you haven’t owned the right retailers, returns have been difficult to find.


By Christine Hughes, OtterWood Capital

This comes at the totally wrong time. Read…  And Now Trucking Is Suddenly Slowing Down

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  1 comment for “Retail Propped up by Only 3 Names

  1. economicminor
    Oct 29, 2015 at 10:20 am

    Only EXPE has a *reasonable* p/e of around 20. And the average p/e of the 3 is …….. almost 400

    No bubble here… it is all about future growth… he he … lots of future growth or a loooong way into the future. When the general overall economy of the working class recovers… world wide.

    I missed that train.. and now it is going way to fast for me.. Oh well, I’ll just hope I can see the next one coming.. from Hogswarts probably.

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