Consumer discretionary stocks have been a fairly predictable trade over the last five years. In 2020 and 2021, this was an ideal sector to buy as consumers were flush with stimulus cash, and online shopping was the national pastime. Travel stocks were left out during this run, but not to worry; they started to take off in 2022 and 2023.
In 2024, the story has been different. Lower- and middle-income consumers are showing signs of being tapped out for non-essential purchases, and even higher-income consumers are becoming more selective. This has narrowed the list of buyable stocks considerably. You don't need to worry about that if you have a long position, but if your timeline is shorter, it's concerning.
Nevertheless, the Federal Reserve is indicating that it's time to take a close look at this sector. The reason? Lower interest rates. There's no telling when that will happen, but you don't want to be out of consumer discretionary stocks when that pivot occurs. Here are seven names to consider.
Click the "Continue to Slide #1" button to view the first company.
