Top 10 retail stocks: Which stocks are due to have the most wonderful time of the year?
Retailers are coming under immense pressure due to various global crises – but many of the sector’s companies are still powerful multinational giants. The biggest retailers in the world attract thousands of customers both in store and online.
But what is likely to happen to these retail corporations in the run-up to what is usually the busiest time of the year? Are we set for a bumper Christmas or will Santa fail to deliver?
Here we examine the prospects for the world’s top 10 retail stocks and how their share prices have performed in what has been a very challenging 12 months.
What has happened over the past year?
Global retail giants have had a lot to contend with over the past 12 months, with soaring inflation, rising interest rates and sky high energy bills. There have been global supply chain issues and the ongoing Russia-Ukraine war, as well as recruitment problems and the lingering effects of Covid-19 restrictions.
These issues have understandably hit the valuations of prominent retailers. Amazon has been among the worst affected, with its stock price down 46% over the past year. Alibaba has tumbled 41% over the same period, while Home Depot is down 21% and Costco by a more modest 1.6%. Only Walmart, with its 8.7% increase, has emerged in better shape.
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Top 10 retail stocks: Who are the biggest names?
The largest retailers in the world are household names in their own countries – and many of them have a truly global reach. We kick off our list of the top 10 retail stocks by putting the spotlight on the top five, according to CompaniesMarketCap.
Amazon (AMZN)
Market capitalisation | $942.84bn |
Current stock price (30 November) | $92.34 |
Price a year ago | $172.19 |
The top retail company stock is Amazon (AMZN). The US e-commerce giant started selling books in the mid-1990s before expanding into everything from electronics goods to clothes and furniture.
The company has continued to expand and now has a significant presence in a number of different areas, including cloud computing. It also provides downloadable and streaming content through Amazon Prime Video and Amazon Music, as well as being involved in publishing, film production and cloud computing.
Walmart (WMT)
Market capitalisation | $415.19bn |
Current stock price (30 November) | $151.88 |
Price a year ago | $140.63 |
US multinational retailer, Walmart (WMT), which operates hypermarkets and discount department stores, welcomes around 230 million customers every week. Sam Walton founded the company in 1962, when he opened his first store in Rogers, Arkansas. His philosophy was to build a business around offering low prices and great service.
Today, Walmart operates 10,500 stores and clubs under 46 banners in 24 countries, as well as e-commerce websites. It employs 2.3 million people around the world.
Home Depot (HD)
Market capitalisation | $322.02bn |
Current stock price (30 November) | $312.56 |
Price a year ago | $400.61 |
US home improvement retailer Home Depot (HD) was founded in 1978. It sells tools, appliances and various construction products. The first two stores opened in Atlanta, Georgia, and there are now 2,321 of them spread across the US, Canada and Mexico.
The company, which generated $151.2bn in revenue during 2021, sells more than 35,000 products in store and a million online. Home Depot’s stock price has felt the global pinch over the past year, tumbling from $400.61 to $315.96 on 30 November, 2022.
Costco (COST)
Market capitalisation | $234.11bn |
Current stock price (30 November) | $525.00 |
Price a year ago | $539.38 |
Costco (COST) is a US company that operates an international chain of membership warehouses primarily aimed at small to medium sized businesses, but also welcomes individuals. The outlets offer a wide wide range of products, including automotive goods, televisions, books, cameras, watches, furniture and office supplies.
As well as the US and Canada, Costco has a presence in locations as far afield as the UK, Taiwan, France, New Zealand, Japan and Australia.
Costco stock has fallen by a relatively modest 1.6%, from $539.38 a year ago to $530.92 on 30 November 2022. It's been as high as $608 and as low as $416 during 2022.
Alibaba (BABA)
Market capitalisation | $213.43bn |
Current stock price (30 November) | $75.88 |
Price a year ago | $127.53 |
Chinese multinational technology business Alibaba (BABA) specialises in areas such as e-commerce and the internet. It’s the only non-US business in the top five. Its stated aim is to serve two billion global consumers by 2036, enabling 10 million businesses to be profitable and creating 100 million jobs.
Alibaba was established in 1999 by a group of 18 people led by Jack Ma, a former English teacher from Hangzhou, China. Its aim was to enable small enterprises to compete globally. It provides the technological infrastructure and marketing reach to help businesses engage with customers and operate more efficiently.
We complete our list of the top 10 retail stocks by looking at the remaining five global retail corporations.
CVS Health
Market cap: $132.55bn
CVS Health (CVS) owns CVS Pharmacy, a retail chain that aims to deliver “innovative, community-based” solutions that are affordable. It has more than 9,900 locations, including those within Target and Schnucks grocery stores, and dispenses millions of prescriptions every year.
Lowe’s Companies
Market cap: $125.45bn
US home improvement retailer Lowe’s Companies (LOW) started life as a small hardware store in North Carolina back in 1921 – and celebrated its 100th anniversary with sales of $96.3bn. The company now has around 1,700 home improvement and hardware stores in the US and a further 450 in Canada.
Jingdong Mall
Market cap: $95.99bn
Jingdong Mall (JD) is a Chinese e-commerce company. Known as JD.com, it’s the country’s largest online retailer and a member of the Fortune Global 500. It describes itself as a one-stop e-commerce platform that provides 588.3 million active customers to a range of products, including both local and international brands.
TJX Companies
Market cap: $93.06bn
US multinational off-price department store retailer TJX Companies’ (TJX) roots can be traced to the mid-1970s, with the opening of TJ Maxx stores in Auburn and Worcester, Massachusetts. It now has 4,700 stores in nine countries, including the UK, Germany and Poland. The company has five distinctive branded e-commerce sites, including tjmaxx.com and marshalls.com.
Inditex
Market cap: $80.30bn
The final name on our list of the top retailing companies is Inditex (ITX), a Spanish multinational company that makes “fashionable, quality and life-enhancing” clothes. It started life in 1963 as a small dressmaking workshop but now has prominent brands with a truly international following, such as Zara and Pull&Bear.
Comparison with last year
Let’s look at what companies were the top retail stocks a year ago, based on their market capitalisations.
E-commerce giant Amazon was top, followed by US retailers Home Depot and Walmart, then Chinese internet business Alibaba, according to market cap data compiled by Statista.
Statista put sportswear giant NIKE (NKE) in fourth spot, while the top five was completed by US multinational Costco. The inclusion of NIKE is the main difference with the current data, as CompaniesMarketCap classifies the company as sports goods, not retail.
At the time of writing, NIKE had a market cap of $166.23bn, which would give it the sixth spot on the list.
It is important to note that this article does not constitute financial or investment advice. Before you choose to invest in any retail stock, always do your own research and remember that your decision should be based on your attitude to risk, your expertise in this market, the spread of your portfolio and how comfortable you feel about losing money. There are no guarantees. Markets are volatile.
You should conduct your own analysis, taking in such things as the environment in which it trades and your risk tolerance. And never invest money that you cannot afford to lose.
FAQs
What is the most consistently growing retail stock?
Walmart (WMT) is seen as one of the most consistently growth retail stocks and provides customers with a wide variety of ways to buy. This has created new opportunities with higher income shoppers, according to data from the National Retail Federation and Kantar Retail.
What is the most profitable retail stock of all time?
It’s virtually impossible to highlight just one stock as it depends on a variety of factors, including the timeframe. However, Amazon has been a strong contender for many years. Its gross profit for the 12 months ending 30 September, 2022 was $216.16bn – up 14.27% year-over-year (YOY), according to Macrotrends.
Which retail stock is better for the future?
It’s impossible to predict as the world is moving at such a pace. While stocks such as Amazon have proved to be capable of changing their business models in response, whether any retail stock is a good investment for you or not will depend on your portfolio composition, investment goals and risk profile, among other factors.
Different trading strategies will suit different investment goals with short or long-term focus. You should do your own research. Remember that past performance is no guarantee of future success. And never invest money you cannot afford to lose.
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