These are scary times. Folks are
cracking open their first paychecks of 2013, only to find that they're
making 2% less than they used to.
This probably isn't news to you and me.
We're financially savvy. We knew that the promise to not raise taxes on
the middle class didn't include extending the two-year stimulus plan
that lowered Social Security taxes from 6.2% of a salary to 4.2%.
However, now that everyone
realizes that there will be less disposable income to dispose of in
2013, many consumer-facing companies are rightfully starting to get
worried. Their customers just got a 2% pay cut, and that's going to make
it harder to sells goods and services that aren't absolutely necessary.
Thankfully, there are plenty of
companies that were built for just this kind of scenario. Let's look at a
few companies that should benefit from consumers who cut back on their
expenditures this year.
Netflix (NASDAQ:NFLX)
The leading video service may seem like an odd choice to start this
list. If someone making $50,000 a year suddenly starts making $1,000
less, cancelling Netflix's $7.99 per month is a good place to start.
However, that will tackle less than 10%
of the shortfall. The real challenge is to dramatically shave a home's
media entertainment expenses, and chunky cable and satellite television
bills are an obvious place to start.
Folks aren't going to eliminate their
Internet connections. We've grown too wired to bail on broadband. The
push to make the most of that connection will hasten the pace of
cord-cutting, and understandably so. Netflix will become an important
lifeline to commercial-free streaming content. After ripping out that
$100 monthly cable bill, Netflix at $8 will be a screaming and streaming
bargain.
Five Below (NASDAQ:FIVE)
The Wall Street Journal recently ran an article about retailers who are bracing for stingier shoppers.
Five Below lives for that. The
fast-growing chain sells a broad selections of closeouts on crafts,
fashion accessories, and media items for $5 or less. There are plenty of
outlets and clearance-bin specialists out there, but Five Below is the
one that appeals to young shoppers by making thriftiness fashionable.
The proof is in the growth. Five Below's
net sales soared 40% in its latest quarter, fueled by heady expansion
and an impressive 8.8% spike in comparable-store sales.
Coinstar (NASDAQ:CSTR)
The DVD is fading as a platform, but paying $1.20 for a nightly movie
rental of a somewhat recent release is a deal. Instead of forking over
$5 for a pay-per-view rental from home -- or not even having that option
once the cable company has been shown the door -- the trek out to a
conveniently located Redbox kiosk makes sense.
There will probably be plenty of people
breaking up with their premium TV providers and settling for a
combination of Netflix and Coinstar's Redbox.
SodaStream (NASDAQ:SODA)
Why buy soda when you can fizz up tap water at home? SodaStream's
popularity has surpassed the novelty phase of making carbonated pop, and
the economical math is also kind once you get past the initial $80 (or
more) investment in the starter system.
Between carbonator and syrup, it costs
roughly $0.25 for a 12-ounce serving of SodaStream soda. Sure, generic
store brands can often be had for that price, but the freshness of
homemade drinks and the eco-friendly benefits of SodaStream make it more
than just a convenient kitchen appliance.
Chipotle Mexican Grill (NYSE:CMG)
During the darkest recessionary stretches -- when most casual-dining and
fast-food chains were struggling to drum up business -- America's
cult-favorite burrito roller was still cranking out positive comps.
Chipotle pointed out at the time that it may have lost some weekday
traffic, but business would spike on Friday as consumers treated
themselves to affordably priced comfort food.
There's no mistaking that the payroll
tax stimulus will hurt restaurants. However, it will mostly crush the
weak and average chains. The kind of place that patrons settle for is
the one that will suffer. That's not Chipotle, where a gargantuan
burrito will set you back about the same as a nondescript fast-food
combo meal.
One more pick for 2013
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for the next year. Find out which stock it is in our brand-new free
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Article Source: Insidermonkey
Article Source: Insidermonkey