These household beauty, sports and fashion brands could deliver strong investment results in 2021.
When we think of investing, most of us think about Silicon Valley and its shiny new offices. Or maybe banks as we know them.
Besides the gigantic tech and finance sectors, another sector you should pay attention to is the fashion and beauty industry.
Why beauty stocks are booming
In a word, millennials. Apparently, the habit of following, liking and sharing make-up tutorials and reviews on Instagram and Twitter is allowing newer but less established labels to compete with the traditional big players.
Thanks to social media, beauty companies are seeing an increased ability to reach and engage with their core customers at unprecedented levels.
As a result, 2019 saw leading beauty stocks make double-digit gains. And according to at least one investment bank, this trend is likely to continue. Hence boosting beauty and luxury stocks as a cooped up world gets ready to ‘go out’ once pandemic restrictions start to ease.
Why fashion stocks are booming
You’d think that with reduced chances to go out, fashion buys would correspondingly go on a decline. Well, no. While brick and mortar stores remain closed in some regions, and those that remain open continue to endure low footfall, online shopping rates have picked up.
For 2020, Alibaba’s Singles Day sale (this time, a two-week event) racked up USD74.1 billion (S$98 billion) worth of transactions, shattering previous records. Similarly, Black Friday 2020 in the US raked in USD14.31 billion in online sales, up 19 per cent over 2019.
Clearly, Covid-19 may keep us indoors, but that’s not stopping us shopping for our favourite fashion brands.
Just by dealing in mass market consumer items and everyday essentials, the fashion sector is a USD 1.65 trillion industry, while the beauty sector is worth around USD 532 billion. With so much money flowing around, you can bet there are gems to be found.
Here are eight beauty and fashion stocks tipped to deliver outstanding results performance* in 2021 and beyond.