Consumer Cyclical: Solid Economic Fundamentals Drive Discretionary Spending
Companies offering experience, specialization, and convenience continue to take share of consumers' wallets.
The market continues to favor consumer cyclical names, with the group continuing to trade at a weighted average price/fair value of 1.05, the same ratio the group traded at last quarter. We continue to attribute the bullish market sentiment to a number of factors, including healthy consumer sentiment in the U.S. and many other developed nations, low unemployment rates and wage increases that are helping drive middle-class consumption globally, and equity and housing market conditions that have been conducive to wealth effect spending.
Jaime M. Katz does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.