There was a lot of love for stocks on Wall Street this week, and there are several companies that are poised to have a very happy Valentine’s Day today. This will be a record $19.6 billion holiday, with 25% of that going to jewelry, 10% to florists, 10% to candy and at least 20% to restaurants. There are a lot of companies that will feel the love, but there are six names that are sure to make investors swoon. Let’s take a quick look at each.
Match Group (MTCH) is the leader in online dating for young (Tinder) and older, more traditional singles. It’s still 85% owned by Barry Diller’s Interactive Corp. (IAC), so the company has friends as well as deep pockets to back up its aggressive merger & acquisition (M&A) strategy. MTCH is on top now and I expect it to stay that way this holiday.
L Brands (LB) is Victoria’s Secret, but it’s become much more than romance. If you compare it to Hanes (HBI), you’ll see that relative luxury has the upper hand right now. Consumers aren’t shifting down to comfy cotton, but instead shifting up the scale to something a little lacier that is able to support richer margins.
Signet Jewelers (SIG) is the sweet spot in diamond retail. It’s not as rarefied as Tiffany (TIF), but it basically runs the physical jewelry store at any mall you walk in. Diamonds have had a hard time over the last few years, but SIG was the big winner.
1-800-Flowers (FLWS) benefits from bouquet delivery – a quintessentially local business – but the real story here is food delivery. The company owns Harry & David, which is the best of the new breed of catalog food companies. This is the real holiday Amazon (AMZN) killer.
Carnival (CCL) is a top play in terms of an all-inclusive experience company, as it sells honeymoons and affordable luxury getaways to people of all ages. Dating isn’t just for kids any more, although singles cruises are finally attracting millennials.
Cheesecake Factory (CAKE) is still the number-one spot for special occasion dates. If 20% of all Valentine’s Day spending goes to restaurant, this one will be the winner.