Tomorrow is Black Friday, one of my favorite "holidays" of the year.
For those that don't know, I LOVE me a good sale on a shiny new product. And I still remember my first Black Friday with my family waiting in line outside of Best Buy. Black Friday was a lot different back then...it was like a nerdy tailgate, complete with a 4-player Xbox setup out the back of someone's van. And the deals were AMAZING! The latest tech and gadgets at rock bottom prices.
But these days, it can feel more like a pack of rabid animals gnawing and gnashing at the doors to snag shitty products at "fake" prices. Did you know companies now make special watered down versions of their usual products, slap the same "name" on the box, and "mark them down" as if you're getting a good deal? The good stuff is only ever marked down like 10%, MAYBE 20%. And the last TV I got on Black Friday is almost unusable, despite being a sleak-looking 55-inch Samsung.
Anyways, I decided this year instead of looking for deals online and in-stores, I would spend some time looking for deals on high quality stocks with strong brands, solid future growth potential, and are down this year despite the market being UP close to 30% year to date. Note: none of this is financial advice, invest at your own risk.
1. Target (Ticker Symbol: TGT)
Why wait outside Target just to get pushed and shoved over some discounted merch when you can just buy the company? Okay maybe not the whole company, but Target's stock is down over 15% this year after disappointing earnings.
What I like: Brand known for higher quality retail, strong long-term performance, 3.7% dividend, 12.8x price to earnings.
Things to Consider: Walmart is eating their lunch on groceries and online shopping, and a comeback is not always guaranteed.
2. Snowflake (Ticker Symbol: SNOW)
Snowflake is a technology company that helps other companies store and retrieve data. For example, the company I work for uses Snowflake to store all the data variables of all our customers and the way they use our products. As I'm writing this, their stock just popped over 30% on strong earnings, and I personally think this is just the start and the stock is still ~30% below it's IPO price.
What I like: Must-have product for many companies as data becomes more important, strong recent earnings report, opportunity to buy below IPO price.
Things to consider: This is a high growth company, which has more volatility and risk compared to a company like Target.
3. Nike (Ticker Symbol: NKE)
Nike is an iconic brand that has struggled over the last two years, and their stock is down close to 30% YTD. Prior to this, they were an incredibly high performing stock and company, however they stopped investing in the brand and other companies like Hoka have taken advantage of this. I think if Nike can pivot back to investing in its brand and the running community at large, it will be able to reclaim its status as a winning athletic brand.
What I like: Iconic brand, okay-ish P/E ratio of 21x, 2.1% dividend, prior to 2021 their stock was average like 60% per year or something crazy like that
Things to consider: The damage may already be done, P/E ratio is good but not great, same with dividend, no guarantee the company will return to its prior status.
4. CVS (Ticker Symbol: CVS)
CVS is down close to 30% this year and has been in a rut since the pandemic, trading in the same $60-100 range for like 5 years now, and right now it's around that $60 level. There's nothing crazy good or bad about the company, they just aren't the most consistent with earnings. I think the level they are trading at now could be an interesting swing trade if they get back to that $100 level. Even if they don't I like the valuation at 14.5x price to earnings and a juicy 4.7% dividend.
What I like: Strong brand & household name, nothing terribly wrong with business model, just volatile earnings, good price to earnings at 14.5x and VERY good dividend at 4.7%. Don't see a dividend like that often with such a namebrand company.
Things to consider: No guarantee the price will get back to $100, although it did twice in the last 5 years, valuation is pretty decent but 12x price to earnings or lower would be nice.
5. Celsius (Ticker Symbol: CELH)
Celsius Holdings makes premium energy drinks that took the market by storm after the pandemic, especially among younger women. They are high quality and don't have all the unhealthy additives that other energy drink companies like Monster and Red Bull have. Their stock has plummeted recently as sales have started to decline. This one is a bit of a long shot, but I think they have the opportunity to find their footing in a market for energy drinks that historically has been underserved.
What I like: Strong brand, high quality product, demonstrated stock price appreciation, potential to dominate an underserved market.
Things to consider: Sales are declining, price to earnings is high at 40x, no dividend, consumers aren't just health conscious but also caffiene concsious. Yes, there's a limit to how much you can have in a day. And while Celsius doesn't serve the same market as Monster and Red Bull, you know who does? Starbucks. And it's PSL season, baby.
If you liked this post, you'll love my YouTube channel. I just posted a video on why stocks might skyrocket in 2025 and what you can do to prepare. Check it out! 👇🏻
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