Tariffs have become the most unpredictable variable in retail investing. Companies that depend on imported goods like electronics, apparel, furniture, and cheap housewares have to reprice, renegotiate, and in some cases, rebuild supply chains on the fly. For investors, that means uncertainty about margins, guidance, and whether the current quarter's earnings number is even meaningful.
The Iran conflict is adding another layer of instability, with the Strait of Hormuz frequently shut down or heavily restricted. That chokepoint carries roughly 20% of global oil, and disruptions are already rippling through shipping routes, costs, and supply chains worldwide.
But not every retailer is exposed the same way. A few business models are structured, either by design or by nature, to be largely insulated from what happens at the border. Here are two that I'd feel comfortable buying regardless of what tariff policy looks like six months from now.
Image source: Getty Images.
1. Ollie's Bargain Outlet
The more tariffs disrupt supply chains, the better Ollie's Bargain Outlet (OLLI 0.63%) does. This is not a coincidence as it's a structural play.
Ollie's is what you call a closeout retailer. When manufacturers change packaging due to tariffs, they wind up with excess inventory. When brands get squeezed on margins, they sell overruns to liquidators. When retailers like Big Lots go bankrupt in part because they can't manage import costs, their inventory flows toward the secondary market, and Ollie's is always at the front of the line To take it off their hands at a discount. Management said it directly on the Q4 2025 earnings call: "Tariffs are just another form of disruption and we benefit from disruption."
The numbers tell the same story. In fiscal 2025, Ollie's opened a record 86 new stores, grew net sales 17% year over year to approximately $779 million in the fourth quarter alone, and grew its Ollie's Army loyalty program to 16.6 million members. The company acquired 63 former Big Lots locations through the bankruptcy auction, securing prime real estate in established value-retail corridors.
The long-term store count target is more than 1,300 locations -- roughly double today's footprint. The company carries no long-term debt, and free cash flow has been consistently strong enough to fund accelerating share repurchases.
Analysts at Wells Fargo upgraded the stock to Overweight in March 2026 with a $130 price target, implying a 36% upside over the next year. The analysts noted that Ollie's customer base skews older and is positioned to benefit from senior-focused tax deductions and Social Security cost-of-living adjustments under current policy.
NASDAQ: OLLI
Key Data Points
2. Five Below
Five Below (FIVE +0.78%) was the stock everyone expected tariffs to break. About 60% of its products are sourced directly from China, and when Liberation Day tariffs hit in April 2025, the stock cratered to a five-year low. That was the fear trade.
Here's what actually happened. Five Below leaned in. Management rebuilt its product assortment around licensed merchandise, viral trend items, and teen-focused impulse buys -- from Dubai chocolate dupes to its own knockoff of Pop Mart's Labubu collectibles. By Q4 fiscal 2025, comparable sales surged 15.4% year over year, revenue rose 24.3% to $1.73 billion, and adjusted EPS of $4.31 beat estimates of $3.98. As a result, the stock price has more than tripled from its April 2025 lows.
NASDAQ: FIVE
Key Data Points
The tariff playbook here is about adaptability, not immunity. Five Below absorbed roughly 160 basis points of gross-margin pressure from tariff costs, and offset most of it through fixed-cost leverage. For fiscal 2026, management guided sales of $5.20 to $5.30 billion and adjusted EPS of $7.74 to $8.25, ahead of consensus even with persistent tariff costs baked in.
The risk here is a bit real. A reescalation of China tariffs with no relief would compress margins again, and supply chain disruptions related to the Iran War could stress the ticker. But a management team that just navigated one of the worst tariff environments in modern retail history and emerged with its best quarterly comps in years is not one to bet against.
