There are always opportunities for investors in consumer-facing companies, and the year ahead isn't any different. There are some consumer goods companies that have thrived and will keep thriving in 2017. There are also some companies that have struggled to resonate with investors in 2016, but positioned to bounce back in the year ahead.
Let's check out five consumer stocks that should beat the market in 2017.
Zoes Kitchen (NYSE:ZOES)
The leading fast-casual chain specializing in Mediterranean cuisine has had a rough 2016. The stock is trading lower year to date, giving back earlier gains after posting back-to-back quarters where it had to scale back its guidance.
Zoes Kitchen is still going strong. The 201-unit chain has posted positive comps for 27 consecutive quarters. Combine the store-level gains with heady expansion and you have a recipe for double-digit sales growth -- as well as a recipe for Zoes Kitchen as a bounce-back candidate.
The market's cooling on Fitbit's fitness trackers. Growth has decelerated to the point where Fitbit's forecasting just 2% to 5% growth during the holiday quarter.
Fitbit hasn't been asleep at the wheel when it comes to new products. It's been updating its product lines, and it's starting to gain traction in the corporate wellness market. Calling Fitbit stock out of favor is an understatement. It has surrendered 75% of its value in 2016. It can double in 2017 and still be trading for half what it was when 2016 began. Fitbit's brand is too valuable to not stage some kind of rebound.
Another stock that's trading lower in 2016 is Skechers. It's also facing Fitbit's monster of decelerating growth. The footwear maker that would routinely grow at a double-digit pace is eyeing flat year-over-year growth for the current quarters.
Skechers has been struggling with its wholesale business, and expanding its base of namesake stores may no longer be enough. However, fundamentally speaking we're becoming more active -- and that means shoes will need to be replaced more often.
Michael Kors (NYSE:CPRI)
Four stocks in, we finally get to our first name that's trading higher year to date. The designer handbag company has fallen on hard times with flat sales growth, but it has managed to beat Wall Street's profit targets in each of the past four quarters.
Michael Kors purses and accessories aren't cheap, but that's not necessarily a bad place to be. If Donald Trump is successful in lowering tax rates, it should benefit luxury goods, taking Michael Kors along for the ride.
SeaWorld Entertainment (NYSE:SEAS)
Let's end on a controversial pick. Shares of the marine life operator have had a rough 2016, but the stock's been bouncing back since it moved to end its once-lofty quarterly dividend. SeaWorld has tried to appease critics, announcing that it will wind down the controversial orca whale performances at its three namesake parks.
Attendance is starting to stabilize, and SeaWorld is investing in rides, shows, and other attractions that don't involve stirring the pot of sore Blackfish-viewing activists. If the turnstile clicks turn positive in 2017 -- and that appears to be the trend -- the stock should follow suit.