Earlier this month we saw Debenhams getting delisted after falling into administration. It seems like the UK retail sector has a very bleak future, but I’m here to argue that you shouldn’t give up on the market just yet!
The high street hasn’t died its final death quite yet. Some retail stocks have been steadily on the rise in 2019 and I’m about to show you the ones worth considering…
Going strong both in-store and online
Dunelm (LSE: DNLM), the home furnishings retailer, seems to be enjoying huge success whilst the other high street stores are struggling. At the end of March the company released its Q3 results, which showed huge sales growth in-store just shy of 10% in the first nine months of its current financial year, whilst online sales jumped by almost one-third.
Dunelm has estimated that if it can keep up this great momentum ahead of June, then it will enjoy an annual pre-tax profit of around £118.5 million, which is ahead of analysts’ predictions and of what its profit was last year. I’m not hugely surprised by Dunelm’s growth thanks to its awesome online strategy and a large number of stores, and this is a retail stock I definitely would recommend.
Taking the world by storm
JD Sports (LSE: JD) seems to be bucking the challenges of the high street, with revenue leaping over 49% in its annual results from February 2019. The company has opened new stores in Europe and Asia with even more growth opportunities in the future as it has recently bought Finish Line whilst being in the process of acquiring Footasylum.
JD Sports is fully aware of the threat Brexit poses to high street retailers, but I believe that its recent investment in international stores will prevent it from suffering. Due to recent store acquisitions, investments in existing stores and international growth, I think that JD Sports is a share definitely worth owning!
Food retailer on a roll
I’m going to go ahead and apologise for my shameless pun above… the next retailer is Greggs (LSE: GRG). As busy humans, we all love convenience and it’s really showing in the markets! Food-to-go is booming and Greggs is most definitely benefitting from this. It is keeping up with the social media trends and popular lifestyle choices by introducing its new vegan sausage roll, which has really helped its popularity grow with the younger consumers.
Greggs saw revenue rise 7.2% in 2018 and broke the £1 billion threshold for the first time! The company has said that it has started 2019 in “great form” as the momentum continues to build – it expects to be in a position to pay a special dividend when interim results are revealed in July. The Greggs share price has now been pushed to its highest ever level but as it’s continuing to rise, you might want to invest soon…
So, before you disregard UK retail stocks after the Debenhams disaster, I urge you to check out the options above and thank me later!
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Fiona owns shares in JD Sports and Dunelm. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.
Motley Fool UK 2019