Walmart, Target, Bath & Body Works Stand Out As Black Friday Winners: Analysts

Retailers saw increased traffic both online and in-store during the busiest Black Friday shopping weekend ever. BofA Securities analysts weighed in on the retail sector's early holiday winners. 

E-commerce: According to Adobe Analytics, online sales during Thanksgiving and Black Friday grew 9% and 10% respectively, from 2023 levels. BofA Securities analysts highlighted an increase in the use of AI shopping assistants, up 31% from last year and sites featuring AI services saw a 9% increase in conversion rates. 

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The analysts also highlighted a return to strong growth in the e-commerce sector based on early holiday data with retailers like Amazon.com Inc. AMZN and Wayfair Inc. W driving growth with a focus on value and faster delivery speeds. Top categories included makeup and skincare, smart watches and movie merchandise, particularly from the Harry Potter and Wicked franchises.

In-Store: BofA Securities conducted an in-store survey across four states and reported Walmart Inc. WMT, Target Corp. TGT and Academy Sports and Outdoors Inc. ASO as the "stand-outs" in terms of in-store traffic.

The firm also highlighted Costco Wholesale Corporation COST and BJ’s Wholesale Club Holdings Inc. BJ as well-positioned to benefit from the consumer's continued focus on value this holiday season.

Specialty Retailers: BofA highlighted Bath & Body Works, Inc. BBWI as its top holiday pick among specialty retailers and maintained a Buy rating and price target of $45 on the stock. The research firm expects continued growth from the company's third-quarter sales inflection driven by product partnerships and category launches. 

BofA Ratings: 

• Maintained Target shares with a Buy rating and a $160 price objective. 
• Maintained Academy Sports and Outdoor with a Neutral rating and a price target of $63.  
• Maintained Walmart stock as a Buy with a $105 price objective. 
• Maintained a Buy rating on Amazon shares with a price target of $230. 
• Maintained its Buy rating and price target of $962 on Costco stock. 

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