Despite the downbeat economy, some hidden holiday stocks represent overlooked opportunities for investors. The current consumer sentiment numbers aren’t great, considering today’s stats remain below the already-low levels we saw last holiday season. This means big-name buys are likely out of the question this season. Instead, investors should look to companies offering smaller, affordable, but still “nice to have” items.
Like the sentiment index, the personal savings rate is still at near-record lows. Still, some holiday stocks offer products priced just right for strained budgets with a little financial flexibility. Investors should consider holiday stocks with in-demand products, name recognition, and pricing that won’t break the bank. These holiday stocks meet the mark.
Nintendo (NTDOY/NTDOF)
Nintendo (OTCMKTS:NTDOY, OTCMKTS:NTDOF) is having quite a year, but its share price doesn’t match its hidden holiday potential yet. Investors watching Nintendo stock saw a slew of news in the past few months, with more to come.
First, a leaked rumor surfaced, suggesting that Nintendo and Google (NASDAQ:GOOG, NASDAQ:GOOGL) might be collaborating to create a virtual reality (VR) gaming headset. While there’s been no official confirmation, the potential for a Nintendo/Google partnership holds massive implications.
More recently, another leak revealed that Microsoft (NASDAQ:MSFT) had also explored partnering with Nintendo. In a message, Phil Spencer, a Microsoft Gaming executive, discussed the potential for such a partnership and mentioned the growing interest of activist shareholders in Nintendo’s stock, which could open doors for further opportunities. This email dates back to 2020 but suggests ongoing high-level commercial interest in Nintendo.
Even if these rumors don’t bear fruit by this holiday season (they won’t), Nintendo stock has short-term potential. Meeting the criteria mentioned before – high-end products priced right – Nintendo just announced its new Switch OLEN console. The next-gen hardware is at its lowest price yet, meaning Nintendo is adapting its pricing model to match consumer spending.
Crocs, Inc. (CROX)
Crocs, Inc. (NASDAQ:CROX) might not be the most fashion-forward company, but its shoe selection remains popular and a common holiday purchase priced right in range with household budgets. Just in time for the holiday season, Crocs released new cowboy boot variants of their classic slide sandal. Even if many consumers buy them as a gag gift, immediate reactions clearly conveyed consumer excitement.
Further reinforcing Crocs’ holiday stock potential, its last earnings report was shockingly upbeat considering the tight economy. The company hit record quarterly sales, banking more than $1 billion in revenue. That’s a solid 12% growth, yet the stock’s share price remains more than 15% down since January. Crocs is also adapting its model to shifting economic winds, cutting costs internally and expanding its gross margin substantially between periods.
And, for current investors, CROX announced it would begin its share buyback program again shortly. In July, the company bought back just $50 million of shares. The board still has authorization to buy back a whopping $1 billion, representing tremendous shareholder value in months to come.
Sharkninja Inc (SN)
Sharkninja (NYSE:SN) is one of the best holiday stocks for this season. The diversified appliance company makes higher-end products like ice cream makers, coffee machines, and more – but priced well below luxury and boutique counterparts.
The stock exploded in recent months as it entered the market, and Jefferies analysts pegged its fair value at $67 per share. Despite a recent surge, that price target is still 70% below current pricing. That means massive upside potential for this holiday stock.
Sharkninja’s sales are notoriously strong, even amid downtrodden economic conditions. Sharkninja consistently hit 20% annual sales growth since 2008, with limited indication that the trend is slowing. Management anticipates a $4 billion total net revenue for the year, meaning Sharkninja is a consumer discretionary stock that’s become a staple for the holiday season.
On the date of publication, Jeremy Flint held no positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
