ZACKS·2025-11-26 15:21Core Insights - The holiday sales season for 2025-26 in the U.S. is crucial, with Thanksgiving and Black Friday being key days for consumer spending [2] - Despite a challenging economic environment, holiday sales are expected to grow, albeit at a muted rate, leading to recommendations for five apparel and shoe stocks with strong short-term upside potential [3][10] Industry Overview - Consumer spending is the largest component of U.S. GDP, and the holiday season represents the peak period for this spending [3] - The apparel and footwear industry is facing challenges as consumers shift towards value-driven purchases, impacting demand [6] - The Zacks Retail – Apparel and Shoes industry ranks in the top 26% of Zacks Industry Rank, indicating potential for outperformance in the next three to six months [7] Company Highlights Crocs Inc. (CROX) - Crocs has a Zacks Rank of 1 and is experiencing significant growth in brand awareness through collaborations and product innovations [11] - The company is refreshing its product lines and has an expected revenue growth rate of 0.4% and earnings growth rate of 3.9% for the next year [14] - The short-term average price target for CROX indicates an 11.2% increase from its last closing price of $83.07 [14] On Holding AG (ONON) - On Holding also holds a Zacks Rank of 1, focusing on ultralight footwear and sports apparel [15] - The expected revenue growth rate is 21.2% and earnings growth rate is 79.8% for the next year [16] - The short-term average price target suggests a 45.3% increase from the last closing price of $41.78 [16] Ralph Lauren Corp. (RL) - Ralph Lauren has a Zacks Rank of 2 and has outperformed the industry due to its strategic "Next Great Chapter: Accelerate Plan" [17] - The company is investing in digital transformation, with expected revenue growth of 9.5% and earnings growth of 25% for the current year [20] - The short-term average price target indicates a 3.3% increase from the last closing price of $364.50 [20] Kontoor Brands Inc. (KTB) - Kontoor Brands, with a Zacks Rank of 2, operates lifestyle apparel brands like Wrangler and Lee [22] - The expected revenue growth rate is 11.3% and earnings growth rate is 5.3% for the next year [23] - The short-term average price target suggests a 31% increase from the last closing price of $73.69 [23] Boot Barn Holdings Inc. (BOOT) - Boot Barn Holdings has a Zacks Rank of 2 and focuses on western and work-related footwear and apparel [24] - The expected revenue growth rate is 16.2% and earnings growth rate is 20.5% for the current year [25] - The short-term average price target indicates a 15% increase from the last closing price of $195.76 [25]