Top Retail Stocks for Q3 2022

BXC, CBD, and DDS are top for value, growth, and momentum, respectively

The retail industry provides a variety of finished goods, both durable and nondurable, 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., Inc., and Costco Wholesale Corp.

Retail sales in the United States increased 0.9% in April 2022 despite lower consumer sentiment, high inflation, and rising interest rates. Spending was supported by rising wages and consumers increasing their use of credit cards. The strength in retail sales added pressure on the Federal Reserve to continue with its plan of raising interest rates to weaken demand and slow the pace of inflation. Retail sales numbers for May 2022 will be published by the U.S. Department of Commerce on June 15, 2022.

Retail stocks, as represented by an exchange-traded fund—the SPDR S&P Retail ETF (XRT)—have underperformed the broader market. XRT has provided a total return of -28.1% over the past 12 months, below the Russell 1000 Index’s total return of -2.7%.

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 May 30, 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
BlueLinx Holdings Inc. (BXC) 82.66 0.8 2.2
Garrett Motion Inc. (GTX) 6.04 0.4 2.5
eBay Inc. (EBAY) 48.67 27.3 2.9

Source: YCharts

  • BlueLinx Holdings Inc.: BlueLinx Holdings is a building products distributor. The company offers a wide selection of residential and commercial building products, including engineered lumber, siding, trim, and other construction materials. In early May 2022, BlueLinx announced that its board of directors approved a $75 million increase in the company’s share repurchase authorization to a total of $100 million. The amended share repurchase authorization is set to expire at the end of fiscal year (FY) 2023.
  • Garrett Motion Inc.: Garrett Motion is an automobile technology company. It provides turbocharging, electric boosting, and automotive software solutions to make passenger and commercial vehicles safer and more efficient.
  • eBay Inc.: eBay is an ecommerce company that operates an online marketplace connecting buyers and sellers of new and used items around the world. Its marketplace offers a wide selection of products.

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 year-over-year (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 (%)
Companhia Brasileira de Distribuição (CBD) 4.32 1.2 1,190 6.8
Accel Entertainment Inc. (ACEL) 10.83 1.0 750.0 33.9
Goodyear Tire & Rubber Co. (GT) 12.92 3.6 560.0 39.8

Source: YCharts

  • Companhia Brasileira de Distribuição: Companhia Brasileira de Distribuição is a Brazil-based retail company. It operates supermarkets, hypermarkets, electronics and household appliance stores, ecommerce sites, and a distribution network.
  • Accel Entertainment Inc.: Accel Entertainment is a distributed gaming operator. It installs, maintains, and operates video gaming terminals (VGTs) and other amusement devices in non-casino locations such as bars, restaurants, and convenience stores. The company recently announced that it completed its previously announced acquisition of Century Gaming Inc., a distributed gaming operator, for $164.2 million.
  • Goodyear Tire & Rubber Co.: Goodyear Tire & Rubber is a tire manufacturer. The company produces tires for consumers around the world through its various brands, including Goodyear, Dunlop Tires, Kelly Tires, and more.

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 (%)
Dillard’s Inc. (DDS) 301.48 5.5 139.4
Murphy USA Inc. (MUSA) 249.12 6.0 85.9
SpartanNash Co. (SPTN) 34.41 1.2 69.9
Russell 1000 Index N/A N/A -2.7
SPDR S&P Retail ETF (XRT) N/A N/A -28.1

Source: YCharts

  • Dillard’s Inc.: Dillard’s is a retailer of fashion apparel, cosmetics, home furnishing, and other consumer goods. Its merchandise is available in hundreds of locations across the U.S. as well as online. In mid-May 2022, the company announced financial results for the first quarter (Q1) of FY 2022, the three-month period ended April 30, 2022. Net income rose 58.7% on net sales growth of 21.3% compared with the year-ago quarter.
  • Murphy USA Inc.: Murphy USA is an independent retailer of gasoline products and convenience store merchandise. It also operates a network of terminals for distributing fuel. It serves millions of customers across the U.S. In early May 2022, Murphy USA announced that its board of directors has declared a quarterly cash dividend of $0.31 per share. The dividend reflects a 7% increase from the previous quarter. It was scheduled to be paid on June 1, 2022, to stockholders of record as of May 17, 2022.
  • SpartanNash Co.: SpartanNash is a distributor, wholesaler, and retailer of grocery and household goods. It operates a global supply chain network serving independent and chain grocers, ecommerce retailers, U.S. military commissaries and exchanges, and its own grocery stores, pharmacies, and fuel centers.

The comments, opinions, and analyses expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or adopt any investment strategy. While we believe the information provided herein is reliable, we do not warrant its accuracy or completeness. The views and strategies described in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all comments, opinions, and analyses contained within our content are rendered as of the date of the posting and may change without notice. The material is not intended as a complete analysis of every material fact regarding any country, region, market, industry, investment, or strategy.

Article Sources
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  1. Reuters. “Strong U.S. Retail Sales, Manufacturing Output Boost Economic Outlook.”

  2. U.S. Department of Commerce, via U.S. Census Bureau. “Advance Monthly Sales for Retail and Food Services, April 2022,” Page 1.

  3. YCharts. “Financial Data.”

  4. BlueLinx Holdings, Investor Relations. “BlueLinx Announces Increase in Share Repurchase Authorization to $100 Million and Entry into $60 Million Accelerated Share Repurchase Agreement.”

  5. Garrett Motion. “Our Story.”

  6. eBay. “Our Company.”

  7. Companhia Brasileira de Distribuição (dba GPA). “About Us.”

  8. Accel Entertainment, Investor Relations. “Accel Entertainment Completes Century Gaming Acquisition.”

  9. Goodyear Tire & Rubber Corporate. “Home Page.”

  10. Dillard’s, Investors. “Dillard’s, Inc. Reports First Quarter Results.”

  11. Murphy USA, Investor Relations. “Murphy USA Inc. Announces Dividend Increase.”

  12. SpartanNash. “Company Profile.”

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