Consumer Cyclical Stock Performance - Yahoo Finance (2024)

FAQs

What is the performance of consumer cyclicals? ›

The performance of consumer cyclicals is highly related to the state of the economy. They represent goods and services that are not considered necessities but discretionary purchases. During contractions or recessions, people have less disposable income to spend on consumer cyclicals.

Consumer cyclical stocks are typically popular with investors when the economy is growing, because that's when consumers are more likely to spend. The sector includes industries like retail stores, automakers, and restaurant and entertainment companies, to name just a few.

Largest Companies in This Sector

AMZN Amazon.com, Inc. TSLA Tesla, Inc. HD The Home Depot, Inc. NKE NIKE, Inc.

This sector includes retail stores, auto and auto parts manufacturers, companies engaged in residential construction, lodging facilities, restaurants, and entertainment companies.

Investors looking to weather a recession can use exchange-traded funds (ETFs) as one way to reduce risk through diversification. ETFs that specialize in consumer staples and non-cyclicals outperformed the broader market during the Great Recession and are likely to persevere in future downturns.

Given the up-and-down nature of the economy—and, consequently, that of cyclical stocks—successful cyclical investing requires careful timing. It is possible to make a lot of money if you time your way into these stocks at the bottom of a down cycle just ahead of an upturn.

Is Walmart a cyclical stock? ›

While NVIDIA's consumer or enterprise products are typically considered a luxury, after all, few people need a GPU to just live, stocks such as the mega retail giant Walmart Inc. (NYSE:WMT) are counter cyclical stocks.

Companies with non-cyclical stocks

Here's some examples for you: Colgate. Tesco. Coca-Cola Company.

Examples of cyclical stocks include Starbucks, Delta Air Lines, Disney, and Apple.

Analysts Are Bullish on Top Consumer Cyclical Stocks: Amazon (AMZN), DraftKings (DKNG) | Markets Insider.

Cyclical stocks rise and fall with the economic cycle. This predictability in the movement of their prices can lead some investors to attempt to time the market. They buy the shares at a low point in the business cycle and sell them at a high point.

An economic cycle is the overall state of the economy as it goes through four stages in a cyclical pattern: expansion, peak, contraction, and trough. Factors such as GDP, interest rates, total employment, and consumer spending can help determine the current stage of the economic cycle.

In short, a business cycle is a series of fluctuations in economic activity (generally measured by the change in the gross domestic product) over a period. As such, cyclical industries are industries that perform well during periods of economic expansion and perform poorly during periods of economic downturn.

The Cyclical Consumer Goods & Services economic sector consists of companies engaged in the production of automobiles, homebuilding, household goods, textiles and apparel, as well as hotel, casino, leisure, media and retail operations and services.

Consumer discretionary goods are not essential. Many consumers will cut back on them to save money when times are bad. Such goods include luxury items, new vehicles, vacations, fast food, furniture, and appliances. Consumer staples are the basics that consumers cannot forgo even when economic conditions turn sour.