The Zacks Analyst Blog Highlights: General Motors, Charles River, DSW, Shoe Carnival And Boingo
Zacks Investment Research | Mar 03, 2019 09:20PM ET
For Immediate Release
Chicago, IL –March 4, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: General Motors Company (NYSE:GM) , Charles River Laboratories International, Inc. (NYSE:CRL) , DSW Inc. (NYSE:DSW) , Shoe Carnival (NYSE:CCL), Inc. (NASDAQ:SCVL) and Boingo Wireless, Inc. (NASDAQ:WIFI) .
Here are highlights from Friday’s Analyst Blog:
5 Stocks to Reap Rewards from U.S.'s Banner 2018
The U.S. economy finished one of the best years of a decade-long economic expansion, growing at a commendable pace in the fourth quarter and defying slowdowns elsewhere in the world.
Pick-up in consumer spending and an uptick in business investment in software, research and equipment boosted economic growth. Consumer outlays in particular improved on a steady job market, healthier household finances and tax cuts. Hence, it seems judicious to invest in areas where consumers have led the way.
GDP Matches Fastest Growth Since Recession
According to the Bureau of Economic Analysis, U.S. GDP expanded a 2.6% annual pace in the fourth quarter of 2018. It was way more than analysts’ expectations of a 1.9% growth rate. The U.S. economy had expanded at a solid 3.4% clip in the third quarter, which followed an even better 4.2% growth in the second quarter.
A slight drop at the end of 2018, however, kept the economy from clocking 3% annual growth rate for the first time since 2005. But, GDP for the full year did match the growth rate attained in 2015, which was the highest since the 2007-2009 Great Recession.
The fourth quarter growth rate is certainly laudable. After all, such steady growth was achieved despite slowdown in global economic growth, consistent turbulence in the financial markets, trade-related disputes with China and the longest partial government shutdown in history.
In fact, the government shutdown that began shortly before Christmas may have cost the economy 0.1 percentage point of growth in the fourth quarter, added the Bureau of Economic Analysis.
Consumer Spending Drives GDP, Business Investments Ramp Up
Consumer spending boosted economic growth. Consumer outlays grew a healthy 2.8% in the fourth quarter as Americans splurged on cars and trucks, health care, clothes and financial services, among other things. Disposable personal income, by the way, increased $225.1 billion in the fourth quarter, compared with an increase of $190.6 billion in the preceding quarter.
Spending improved mostly due to a strong jobs market, household income gains and tax cuts. According to the Bureau of Labor Statistics, employment gains in 2018 turned out to be the strongest in the last three years. In fact, if we consider December’s job additions of 222,000, November’s 196,000 and this January’s 304,000, the labor market has posted the best three-month stretch during an economic expansion dating back nine-and-a-half years ago.
The $1.5-trillion tax cut package that Trump got Congress to pass last year also did put a lot of money in consumers’ pocket. The tax bill trimmed the ultra-rich individual tax bracket from 39.6% to 37%, while the middle class has been excused from paying hefty taxes.
In the meantime, companies increased investments in equipment and product research, offsetting the drop in investments in new construction. Business investment climbed 7% in the year, while investments in software, research & development increased 7.7%, surpassing the 7.5% gain in 2016 — the best since 2000’s 9.5%.
5 Solid Choices
As consumers bump up their spending on cars, healthcare and garments, to name a few, investing in stocks from such areas seems prudent. Significant increase in expenditure on software, research and development also calls for investing in such spaces.
We have, thus, selected five solid stocks from the aforesaid areas that flaunt a Zacks Rank #1 (Strong Buy) or 2 (Buy) and also a Original post
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