Analyst names two retail stocks to buy for 2023

on Dec 19, 2022
  • Dana Telsey is bullish on Ralph Lauren and Abercrombie & Fitch.
  • She explained her constructive view on both on CNBC Squawk Box.
  • Ralph Lauren is down nearly 15% for the year; ANF close to 40%.

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Retail analyst Dana Telsey remains constructive on select retail names for the coming year even though retail sales in November were weaker than expected.

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Telsey is bullish on Ralph Lauren

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Retail sales were down 0.6% last month versus a narrower 0.3% decline expected. Still, Telsey – the Chief Executive of Telsey Advisory Group has confidence in the resilience of the U.S. consumer.

A name she’s convinced will do particularly well in 2023 is Ralph Lauren Corp (NYSE: RL). On CNBC’s “Squawk Box”, Telsey said:

I feel confident with Ralph Lauren going into 2023 that has expanded the purview of who they are appealing to; a wider audience of generations. I think Ralph Lauren’s coming out ahead.

Last month, the New York-headquartered fashion company raised its earnings outlook after reporting a strong second quarter. Its shares are currently down nearly 15% for the year.

Telsey also likes Abercrombie & Fitch

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Consumer prices sure have eased over the past two months (read more) but inflation is still running at an annualised pace of 7.1%. So, the macroeconomic environment is not particularly rosy for the retail space.

Still, another retail stock Telsey recommends owning for the next year is Abercrombie & Fitch Co (NYSE: ANF).

I think they’ve been smart about the way that they are executing both their real estate strategy and their product strategy.

Her “outperform” rating on the lifestyle retailer comes with a price target of $27, which represents a 25% upside from here. Those interested in playing the retail space should also know that retail sales were still up 6.5% versus a year ago in November.


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