Despite inflation worries and potential rate hikes, one expert sees surprising strength in the consumer. Bob Lang, Contributor, TheStreet Pro, reveals the top stocks on his watch list as well as why he is so bullish on the U.S. consumer.
Related: Short sellers are closing in on some shocking tech stocks
Full Video Transcript Below:
CONWAY GITTENS: So tell me which stocks are on your watch list right now?
BOB LANG: Well, I’ve got a couple of consumer names that I really like, and one of my favorites has always been since they went public about 10, 12 years ago is in Hyatt Hotels (H) . And Hyatt hotels is one of the more premier brands of hotels. You’ve got names like Hilton (HLT) and Marriott (MAR) , of course, but and then you’ve got Hyatt and then Intercontinental (IHG) . But I like the Hyatt brand only because they cater very well to the high net worth individuals overseas in Europe and in Asia. They do. They’re going to be reporting earnings this week on on the 13th. And last week we saw we heard earnings from Hilton. And we saw we heard them talking about growth from overseas especially in Europe. And so I’m very excited about that because I think it’s going to going to pose some really strong numbers.
And then on the other, on the other side, I like Chewy (CHWY) , which a lot of people don’t maybe don’t recognize, but Chewy, not the restaurant, but the pet store name, which was spun off some years ago. Chewy is has been growing like crazy. They’re doing lots, all sorts of things in terms of of medical and for for pets. And their digital business has been off the charts. And the last quarter they surprised to the upside and even announced a big share buyback. So the stock has been doing very, very well. It’s been kind of flatlining between the 35 and $40 level. I think over the next 15, 16 months. Conway the stock’s got some room to get a $5,055 if not more. So I and they’re always on the radar screen for a for a buyout as well too. So I’m not saying that’s going to happen. But you know, they’re always being talked about as a potential as being potentially suited.
CONWAY GITTENS: And you have a housewares company on your list too, right?
BOB LANG: I like Williams-Sonoma (WSM) which is another consumer name. I like Williams-Sonoma as a big, strong consumer brand. They’re going to be reporting their earnings for the fourth quarter, which includes the holiday period November, December and January in about a in about a couple of weeks. And the last quarter was just lights out. It was a blowout quarter with huge margins gains and huge share gains. Big revenue. And I think that this last quarter, being the holidays, was probably a good strong quarter for Williams-Sonoma. And I think, you know, they’re trading near all time highs right now.
And I think that this stock’s got some room to get to about 300 bucks I think it’s about $210, $215 right now maybe about $300 by the end of the year, which would be a huge gainer for them. But I think that as long as the margins are really strong and their market share is increasing, they can come back with a with a nice big buyback. They did that last quarter as well. To all things. All systems go for Williams-Sonoma. So I’m scratching my head a little bit based on some of the things you talked about earlier. If interest rates are higher for longer, if commodity prices are headed higher, and on top of that, we’ve got the threat of tariffs.
CONWAY GITTENS: Why would you like consumer facing brands, especially somebody like Williams-Sonoma, which is getting stuff imported. And you also mentioned. Well, it is travel. But let’s talk about the – Why are you so bullish on consumers given the the macro?
BOB LANG: Well I think at least for 2025. Conway the job market has been is still robust. I mean people are working and even last week’s jobs report even was a little bit disappointing. The unemployment rate dropped from 4.1% to 4% So it’s a very, very tight job market. When a tight job market means that labor labor costs are are high and they’re and they’re increasing. And we saw that also with labor costs. So when people are working Conway they’re going to they have money and they’re going to spend. So this is this is what it’s all about. It’s about spending money. And look the economy is 70% of the responsible from the consumer. And I think that this is where you want to this is where you really want to be.
Watch More Videos:
This common budgeting mistake is actually costing you moneyTariffs likely won’t lead to higher prices, top economist saysHow automation is changing professional sportsDiversification isn’t what it used to be — How legends invest
