CNBC’s Jim Cramer mentioned Friday that whereas the retail sector has had a tough week, there are nonetheless a number of winners that stand out towards the deluge of shares that tanked.
“The big four aren’t the only retailers that reported this week, and surprisingly, some of the smaller players actually did pretty well,” the “Mad Money” host mentioned, referring to retail giants Walmart, Home Depot, Target and Lowe’s.
“While retail’s truly awful right now, it’s not uniformly awful. Most stores may be struggling, but you’ve got a few that are doing quite well. And I’m telling you that TJX is definitely a buy, [BJ’s Wholesale] I’m okay on, Foot Locker is alright for a trade,” he later added.
Cramer’s feedback come after a number of retail giants reported their quarterly earnings this week. Target and Walmart each reported disappointing outcomes that noticed their shares fall, whereas Home Depot and Lowe’s fared higher.
“These big box chains are being eaten alive by inflation and changing consumer preferences — people are no longer spending like we’re in a pandemic, they’re spending like we’re back to normal,” Cramer mentioned, noting that that has led to extra stock for these retailers.
While that is unhealthy information for names like Target and Walmart, it is a tailwind for low cost retailers like BJ’s and TJX, which operates TJ Maxx and Marshalls, Cramer mentioned.
TJX “preys on the weakness of other retailers — it’s like a vulture. For several quarters, they couldn’t get their hands on much merchandise because nobody had excess inventory. … When you see Walmart and Target struggling like this, you know TJX won’t have a problem getting good product,” he mentioned.
As for Foot Locker, Cramer mentioned its better-than-expected quarterly earnings places it in a extra snug spot than a number of of its greater friends.
“Clearly, these guys do have a better handle on the current retail landscape than most other operators,” he mentioned.
Disclosure: Cramer’s Charitable Trust owns shares of Walmart.
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