Top Retail Stocks for Q1 2022

QRTEA, MPNGF, and DXLG are top for value, growth, and momentum, respectively

The retail industry provides a variety of finished goods, both durable and non-durable, to individual consumers and households. The industry also sells services. Products sold by retail companies include apparel, electronics, furniture, kitchenware, sporting goods, books, and toys. Some even sell groceries, pharmaceutical products, auto parts, and gardening supplies.

The industry includes traditional brick-and-mortar retailers as well as emerging ecommerce companies. Some of the biggest retail companies include Walmart Inc. (WMT), Amazon.com Inc. (AMZN), and Costco Wholesale Corp. (COST).

The earnings and revenue performance of retailers has varied widely during the COVID-19 pandemic. Many retailers heavily focused on a brick-and-mortar presence have suffered huge declines from normal levels during much of the pandemic, while retailers with a strong ecommerce presence have thrived.

Retail stocks, as represented by an exchange-traded fund—the SPDR S&P Retail ETF (XRT)—have outperformed the broader market. XRT has provided a total return of 32.6% over the past 12 months, above the Russell 1000’s total return of 24.4%.

Here are the top three retail stocks with the best value, the fastest growth, and the most momentum. The market performance numbers above and all statistics in the tables below are as of Jan. 6, 2022.

Best Value Retail Stocks

These are the retail stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows that you’re paying less for each dollar of profit generated.

Best Value Retail Stocks
  Price ($) Market Capitalization (Market Cap) ($B) 12-Month Trailing P/E Ratio
Qurate Retail Inc. (QRTEA) 7.95 3.2 2.7
Companhia Brasileira de Distribuição (CBD) 3.45 0.9 3.1
eBay Inc. (EBAY) 66.81 41.8 3.7

Source: YCharts

  • Qurate Retail Inc.: Qurate Retail is an ecommerce service provider. The company partners with television networks and ecommerce sites, social media, mobile applications, and similar platforms to provide video and digital commerce services worldwide. Qurate operates brands including QVC, HSN, Zulily, and Frontgate, among others.
  • Companhia Brasileira de Distribuição: Companhia Brasileira de Distribuição is a Brazil-based retail company. It distributes food, clothing, home appliances, electronics, and various other items through its chain of hypermarkets, supermarkets, specialized stores, and department stores.
  • eBay Inc.: eBay is an ecommerce company that operates an online marketplace connecting buyers and sellers of new and used items around the world. eBay has about 1.5 billion live listings globally, 19 million sellers, and 152 million active buyers. For its third quarter (Q3) of 2021, ended Sept. 30, 2021, eBay reported 1.2% year-over-year (YOY) growth in net income as net revenues climbed by 10.8%. Revenue growth was driven by the company’s managed payments migration, the expansion of its advertising portfolio, and volume growth in eBay’s focus categories.

Fastest-Growing Retail Stocks

These are the top retail stocks as ranked by a growth model that scores companies based on a 50/50 weighting of their most recent quarterly YOY percentage revenue growth and most recent quarterly YOY earnings-per-share (EPS) growth. Sales and earnings are both critical factors in the success of a company. Therefore, ranking companies by only one growth metric makes a ranking susceptible to the accounting anomalies of that quarter (such as changes in tax law or restructuring costs) that may make one figure or the other unrepresentative of the business in general. Companies with quarterly EPS or revenue growth of more than 2,500% were excluded as outliers.

Fastest-Growing Retail Stocks
  Price ($) Market Cap ($B) EPS Growth (%) Revenue Growth (%)
Meituan (MPNGF) 26.48 162.4 N/A (see company description) 182.2
Vroom Inc. (VRM) 9.63 1.3 N/A (see company description) 177.6
Dingdong (Cayman) Ltd. (DDL) 12.85 3.0 N/A (see company description) 125.6

Source: YCharts

  • Meituan: Meituan is a China-based ecommerce platform offering food, transportation, travel, shopping and entertainment. The company has 200 service categories and operates a bike-sharing brand. Note that Meituan’s most recent earnings, for Q3 2021, were not incorporated into YCharts’ database at the time of this writing, so the revenue growth figure above is based on Q2 2021 results. The company reported negative EPS for that quarter, which is why an EPS growth rate could not be calculated for the above table.
  • Vroom Inc.: Vroom Inc. operates an ecommerce platform for buying and selling used vehicles as well as spare parts, accessories, and repair. The company reported widening net losses YOY for Q3 2021, ended Sept. 30, 2021, as total revenue nearly tripled. Revenue growth was driven by strong performances in the company’s Ecommerce and Wholesale segments in particular. The company reported negative EPS in the most recent quarter, which is why an EPS growth rate could not be calculated for the above table.
  • Dingdong (Cayman) Ltd.: Dingdong (Cayman) is a China-based ecommerce company providing direct delivery of groceries and other daily necessities. The company’s offerings include produce, meat, seafood, and a variety of household items. Dingdong reported widening net losses YOY for Q3 2021, ended Sept. 30, 2021, as revenue more than doubled. Both the company’s products and services revenue increased substantially YOY, driving overall revenue performance. The company reported negative EPS in the most recent quarter, which is why an EPS growth rate could not be calculated for the above table.

Retail Stocks with the Most Momentum

These are the retail stocks that had the highest total return over the last 12 months.

Retail Stocks with the Most Momentum
  Price ($) Market Cap ($B) 12-Month Trailing Total Return (%)
Destination XL Group Inc. (DXLG) 5.94 0.4 2,100
GameStop Corp. (GME) 131.03 10.0 613.7
Build-A-Bear Workshop Inc. (BBW) 22.08 0.4 455.2
Russell 1000 Index N/A N/A 24.4
SPDR S&P Retail ETF (XRT) N/A N/A 32.6

Source: YCharts

  • Destination XL Group Inc.: Destination XL Group is an omni-channel specialty retailer of big and tall men’s apparel. The company operates an ecommerce platform as well as retail and outlet stores in the United States and Canada.
  • GameStop Corp.: GameStop operates a chain of electronic game and software stores nationwide. The company sells video game hardware, software, and accessories. GameStop saw a spike in its shares at key points in 2021, spurred partly by commentary on the Reddit forum r/wallstreetbets.
  • Build-A-Bear Workshop Inc.: Build-A-Bear Workshop operates specialty retail stores. The company offers make-your-own stuffed animal interactive entertainment experiences. In early January 2022, Build-A-Bear announced the launch of HeartBox, a new branded gifting solution offering curated gift boxes. Each HeartBox contains an assortment of products as well as a Build-A-Bear teddy bear with customizable personal voice message. The launch represents an expansion of the company’s efforts in the growing adult-to-adult gift-giving and gift box market.

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  10. Build-A-Bear Workshop, Investor Relations, Newsroom. “Introducing HeartBox, A New Way to Send a Customized Gift with Heart and Hugs.” Accessed Jan. 9, 2022.