TECH - Institutions Think This Consumer Stock Could Break Higher | Benzinga
Markets are preparing for the coming interest rate cycle proposed by the Federal Reserve (the Fed). Though most sectors have priced in this potential pivot, some have yet to reflect this trend higher. Over the past six months, the Consumer Discretionary Select Sector SPDR Fund (ARCA:XLY) underperformed the broader S&P 500 by as much as 11%.
Other sectors, such as technology stocks, outperformed the S&P by more than 5% during this period. Led by the all-time highs in names like Nvidia Cor. (NASDAQ: NVDA), this cyclical shift has left much room for consumer discretionary stocks to catch up.
With U.S. consumer sentiment reaching levels not seen since 2021, Wall Street institutions like The Goldman Sachs Group Inc. (NYSE: GS) and the Vanguard Group saw fit to investigate the space. After bumping its position in PriceSmart Inc. (NASDAQ: PSMT) by 14.9% in the past quarter, Goldman's $2.2 million investment gives Main Street lots to consider.
PriceSmart: A Costco in Disguise
While not as big as its primary business model competitor, Costco Wholesale Co. (NASDAQ: COST), PriceSmart's $2.5 billion market capitalization allows it to grow much faster than Costo and its $316 billion capitalization.
Investors can see this play out in both companies' financial quarters. Costco reported sales growth of 6% in the second quarter of 2024, ...