Three shares expecting Black Friday boost

As with most American imports, Black Friday is all about money, and UK retailers are ready to profit.  

Black Friday and Cyber Monday are relatively recent US exports that have become hotly anticipated dates for bargain-hunting shoppers and the retail outlets they frequent.

They are marketed as the best days to pick up discounted gifts ahead of the festive period as online retailers and high street stores slash their prices. 

Black Friday and Cyber Monday are no longer standalone days of sales anymore, with many major retailers launching big sales events weeks in advance in hope that shoppers come out in force to kick-start the Christmas shopping season.

interactive investor lists three stocks that could (with the emphasis on could!) benefit from bumper Black Friday and Cyber Monday sales this year.

Richard Hunter, Head of Markets, interactive investor, says: “Black Friday tends to create a rush to the entrance for electrical retailers in particular, so one beneficiary could be at the home of the “Geek Squad” in Currys. Part of the Dixons Carphone (LSE:DC.) empire, a FTSE 250 company currently valued at £1.4 billion, the shares have been under pressure, dropping 23% over the past year.

“Dixons Carphone has, however, taken the clever approach of moving slower moving lines of stock online so that it can continue to transform its in-store experience, where it is looking to develop services such as the roll-out of “Gaming Battlegrounds” – so any success from its Currys presence would be a welcome boost to its prospects.

“FTSE 100 supermarket Sainsbury's (LSE:SBRY) has also been in the doldrums of late, having dipped 35% over the past year, mainly due to the failure of the Asda merger. However, the acquisition and integration of Argos has been a resounding success for the company. Having had some success in 2018, Argos has already started a “Crazy Codes” sale and is promising a bumper announcement in the lead up to Black Friday. Again, any signs of success will be warmly welcomed by the parent company.”

Keith Bowman, equity analyst, interactive investor, adds: "In the US, shoppers are increasingly going online over the Black Friday shopping period. 

"While shop visits fell by 9% from 2017 to 2018, Abobe Systems estimated that online sales rose by over 20%. Worldwide sales for online behemoth Amazon (NASDAQ:AMZN) rose to a colossal $72.4 billion during its 2018 end-of-year holiday quarter. A current stock market value of $870 billion, close to the annual economic output (GDP) of a country such as the Netherlands, suggests investors have not overlooked its success. But with the group's own devices such as the Echo dot again likely to be a strong holiday consumer favourite, analyst consensus opinion continues to point to a ‘buy’.”

But do the sales generated on both days have any real effect on stocks? 

Myron Jobson, Personal Finance Campaigner, interactive investor, says: “Both Black Friday and Cyber Monday have really landed on the calendar in the UK, after coming over from America. They have become increasingly important dates for many retailers.

"From an investment perspective, the sales racked up on both days can provide a useful gauge on the overall health of the UK retail industry and individual stocks ahead of the busy festive period. Good sales figures could indicate a rising sales trend, but the opposite could indicate a weaker than expected Christmas season. 

"However, this is just one half of the festive sales story. The UK have strong traditions, like the annual Boxing Day sales, during the Christmas period and I expect that will continue. In addition, the picture is clouded by the change of our shopping habits – more of us are shopping online, with constant deal days held throughout the year.

"Although both days are hardly game changers for the stock market, there might be some stocks that warrant closer attention."

interactive investor's SIPP cashback offer – not just for Black Friday

This year, interactive investor, the UK’s second largest direct to consumer investment platform, has launched a SIPP cashback offer, offering up to £4,000 cashback on qualifying SIPP transfers in (see notes to editors).

The deal applies to a transfer of a pension valued at £25,000 or more from another pension provider into a new or existing interactive investor SIPP made between 4 November 2019 to 3 January 2020. The last time interactive investor ran this offer qualifying customers received an average of £389 cashback.