Retail Stocks to Watch Next Week

Last week was a strong one on the market as the Dow Jones Industrial Average (INDEX: ^DJI  ) gained 3.3% and the S&P 500 (INDEX: ^GSPC  ) rose 3.6%. Hope for avoiding the fiscal cliff and some strong readings about housing helped drive stocks higher, but this week there will be a big focus on retail stocks. The holiday shopping season has begun, and investors will be taking a close look at retail stocks that may be winners or losers over the holidays.

According to comScore, Black Friday's online sales rose 22% to more than $1 billion. The data company expects holiday online retail spending to rise 17% this year to $43.4 billion. That's great news for online retailers such as Amazon.com (Nasdaq: AMZN  ) and eBay (Nasdaq: EBAY  ) , which will be in focus this week.

One interesting development is that people are spending more time shopping online from tablets this year. IBM's (NYSE: IBM  ) Digital Analytics Benchmark showed that 24% of online shopping came from a mobile device and Apple's (Nasdaq: AAPL  ) iPad generated  10% of all online shopping by itself. The tablet accounted for 88.3% of all tablet traffic, according to the report, showing just how dominant the tablet is.

Physical-store sales were a little less impressive. ShopperTrak said Black Friday sales were down 1.8%, but some of those sales may have slipped into stores that opened on Thanksgiving. Overall foot traffic did rise 3.5%, so at least shoppers are out and about.

The trends aren't good for struggling retailers such as Best Buy (NYSE: BBY  ) and J.C. Penney (NYSE: JCP  ) , which aren't nearly as strong online and needed better bricks-and-mortar sales. These stocks may come under more pressure as they continue with their turnaround plans.

A dominant retail play
Apple is dominating online retail with the iPad, but what many don't know is that the company is also one of the most profitable retailers in the world. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and sell Apple, and what opportunities are left for the company (and, more importantly, your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.


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