Validea's Leading Consumer Discretionary Stocks Inspired by Benjamin Graham - September 2, 2025
Top Rated Consumer Discretionary Stocks: The article highlights several top-rated Consumer Discretionary stocks based on Benjamin Graham's value investing strategy, including Shoe Carnival Inc., Academy Sports and Outdoors Inc., Fox Factory Holding Corp., Winnebago Industries Inc., and G-III Apparel Group Ltd., with ratings ranging from 71% to 100% based on their fundamentals and valuations.
About Benjamin Graham and Validea: Benjamin Graham, known as the "Father of Value Investing," significantly influenced the investment world, mentoring notable investors like Warren Buffett. Validea is an investment research service that analyzes stocks based on the strategies of legendary investors, including Graham.
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Tutor Perini (TPC) Initiates $0.06 Quarterly Dividend Amid Record Cash Flow and Share Repurchase
- Dividend Initiation: Tutor Perini announced a $0.06 quarterly dividend starting November 18, 2025, with the first payment on December 23, 2025, marking a significant turnaround after three years of net losses, as the company expects to report a profit of $4.10 per share for 2025.
- Cash Flow Innovation: By Q3 2025, Tutor Perini achieved record year-to-date operating cash flow of $574.4 million, supported by a historic backlog of $21.6 billion, indicating robust business recovery and future growth potential.
- Share Repurchase Program: The company also announced a $200 million share repurchase program aimed at enhancing earnings per share by reducing the number of outstanding shares, thereby boosting investor confidence and driving stock price appreciation.
- Enhanced Industry Position: As one of the largest general contractors in the U.S., Tutor Perini's dividend policy not only attracts momentum investors but may also provide greater market share and capital inflow in the highly competitive construction industry.
Saks Global Files for Chapter 11, Secures $1.75B Financing
- Bankruptcy Filing: Saks Global, the luxury retailer, has filed for Chapter 11 due to debt issues, promising to pay outstanding invoices during the restructuring process, highlighting the severity of its financial crisis.
- Financing Support: The company has secured $1.75 billion in committed capital aimed at supporting its restructuring plan and maintaining operations, despite challenges posed by high interest rates and declining sales.
- Changing Market Environment: The luxury market saw rapid growth post-pandemic, but inflation and rising interest rates have narrowed the customer base to the ultra-wealthy, severely impacting Saks' sales.
- Increased Competitive Pressure: While Saks Global struggles, competitors like Bloomingdale's and Nordstrom are experiencing growth, with Bloomingdale's reporting its best sales growth in three years, underscoring the intense market competition.
G-III Apparel Group (GIII) Stock Rises 10.9%, Demonstrating Strong Momentum
- Price Momentum Growth: G-III Apparel Group's stock has increased by 1.1% over the past four weeks, indicating growing investor interest and enhancing its attractiveness in the market.
- Long-Term Return Potential: The stock has risen 10.9% over the last 12 weeks, reflecting not only its ability to fluctuate in price in the short term but also its potential for long-term investment, drawing more investor attention.
- Momentum Score Advantage: G-III currently holds a Momentum Score of A, suggesting that now is an opportune time to enter the stock for a higher probability of success in capturing potential gains.
- Reasonable Valuation: Despite G-III's fast-paced momentum, it trades at a Price-to-Sales ratio of only 0.41, meaning investors pay just 41 cents for every dollar of sales, indicating significant room for price appreciation.
Cintas Reports Q2 Earnings Exceeding Expectations, Year-over-Year Revenue Growth
Earnings Performance: Cintas Corporation reported Q2 fiscal 2026 earnings of $1.21 per share, exceeding estimates, with a year-over-year increase of 11%. Total revenues reached $2.80 billion, up 9.3% from the previous year.
Segment Revenue Growth: The Uniform Rental and Facility Services segment generated $2.16 billion in revenue (up 8.3%), while the First Aid and Safety Services segment saw a 14.3% increase to $342.2 million. All Other businesses contributed $302.4 million, reflecting an 11.2% rise.
Cost and Profit Analysis: Cintas' cost of sales rose 8% to $1.39 billion, with gross profit increasing 10.6% to $1.41 billion, resulting in a gross margin of 50.4%. Selling and administrative expenses also increased by 10.4%.
Future Outlook: For fiscal 2026, Cintas expects revenues between $11.15-$11.22 billion and earnings per share of $4.81-$4.88, both higher than previous estimates. The company also plans to manage net interest expenses of approximately $104 million.
Four Consumer Discretionary Stocks to Invest in, Including Crocs, for 2026
Crocs' Brand Transformation: Crocs has evolved from a niche functional brand to a culturally relevant lifestyle name, focusing on product innovation and strategic collaborations to drive sustainable growth, resulting in an 11.3% increase in shares over the past three months.
Product Innovation and Market Strategy: The company is enhancing its core product lines, including clogs and sandals, while also expanding its direct-to-consumer channels and international presence, maintaining pricing discipline to protect margins.
Challenges with HEYDUDE Brand: Despite facing challenges with its HEYDUDE brand due to cautious consumer behavior and market pressures, Crocs is refreshing its product lineup to improve profitability and navigate the current market environment.
Positive Earnings Outlook: Crocs has seen strong positive earnings estimate revisions, with projected EPS growth of 5% and 8.6% for the current and next year, respectively, indicating a robust financial outlook amidst ongoing strategic efforts.
Zacks Industry Forecast for Ralph Lauren, V.F., Crocs, and G-III Apparel
Industry Trends: The textile-apparel industry is enhancing omnichannel frameworks, integrating physical and digital retail to meet consumer demand for online and hybrid shopping experiences, despite facing near-term margin challenges from increased marketing and potential tariffs.
Brand Strategies: Companies like Ralph Lauren, V.F. Corp, Crocs, and G-III Apparel are focusing on product innovation, disciplined pricing, and strategic brand investments to strengthen brand equity and capitalize on favorable market conditions.
Digital Transformation: Brands are investing in digital capabilities and customer engagement strategies, including improved mobile applications and fulfillment options, to adapt to changing consumer expectations and enhance the overall shopping experience.
Financial Performance: The textile-apparel industry has underperformed compared to the broader consumer discretionary sector and the S&P 500, with a current Zacks Industry Rank of #46 indicating positive near-term prospects, despite challenges related to input costs and shipping disruptions.
Tutor Perini (TPC) Initiates $0.06 Quarterly Dividend Amid Record Cash Flow and Share Repurchase
- Dividend Initiation: Tutor Perini announced a $0.06 quarterly dividend starting November 18, 2025, with the first payment on December 23, 2025, marking a significant turnaround after three years of net losses, as the company expects to report a profit of $4.10 per share for 2025.
- Cash Flow Innovation: By Q3 2025, Tutor Perini achieved record year-to-date operating cash flow of $574.4 million, supported by a historic backlog of $21.6 billion, indicating robust business recovery and future growth potential.
- Share Repurchase Program: The company also announced a $200 million share repurchase program aimed at enhancing earnings per share by reducing the number of outstanding shares, thereby boosting investor confidence and driving stock price appreciation.
- Enhanced Industry Position: As one of the largest general contractors in the U.S., Tutor Perini's dividend policy not only attracts momentum investors but may also provide greater market share and capital inflow in the highly competitive construction industry.
Saks Global Files for Chapter 11, Secures $1.75B Financing
- Bankruptcy Filing: Saks Global, the luxury retailer, has filed for Chapter 11 due to debt issues, promising to pay outstanding invoices during the restructuring process, highlighting the severity of its financial crisis.
- Financing Support: The company has secured $1.75 billion in committed capital aimed at supporting its restructuring plan and maintaining operations, despite challenges posed by high interest rates and declining sales.
- Changing Market Environment: The luxury market saw rapid growth post-pandemic, but inflation and rising interest rates have narrowed the customer base to the ultra-wealthy, severely impacting Saks' sales.
- Increased Competitive Pressure: While Saks Global struggles, competitors like Bloomingdale's and Nordstrom are experiencing growth, with Bloomingdale's reporting its best sales growth in three years, underscoring the intense market competition.
G-III Apparel Group (GIII) Stock Rises 10.9%, Demonstrating Strong Momentum
- Price Momentum Growth: G-III Apparel Group's stock has increased by 1.1% over the past four weeks, indicating growing investor interest and enhancing its attractiveness in the market.
- Long-Term Return Potential: The stock has risen 10.9% over the last 12 weeks, reflecting not only its ability to fluctuate in price in the short term but also its potential for long-term investment, drawing more investor attention.
- Momentum Score Advantage: G-III currently holds a Momentum Score of A, suggesting that now is an opportune time to enter the stock for a higher probability of success in capturing potential gains.
- Reasonable Valuation: Despite G-III's fast-paced momentum, it trades at a Price-to-Sales ratio of only 0.41, meaning investors pay just 41 cents for every dollar of sales, indicating significant room for price appreciation.
Cintas Reports Q2 Earnings Exceeding Expectations, Year-over-Year Revenue Growth
Earnings Performance: Cintas Corporation reported Q2 fiscal 2026 earnings of $1.21 per share, exceeding estimates, with a year-over-year increase of 11%. Total revenues reached $2.80 billion, up 9.3% from the previous year.
Segment Revenue Growth: The Uniform Rental and Facility Services segment generated $2.16 billion in revenue (up 8.3%), while the First Aid and Safety Services segment saw a 14.3% increase to $342.2 million. All Other businesses contributed $302.4 million, reflecting an 11.2% rise.
Cost and Profit Analysis: Cintas' cost of sales rose 8% to $1.39 billion, with gross profit increasing 10.6% to $1.41 billion, resulting in a gross margin of 50.4%. Selling and administrative expenses also increased by 10.4%.
Future Outlook: For fiscal 2026, Cintas expects revenues between $11.15-$11.22 billion and earnings per share of $4.81-$4.88, both higher than previous estimates. The company also plans to manage net interest expenses of approximately $104 million.
Four Consumer Discretionary Stocks to Invest in, Including Crocs, for 2026
Crocs' Brand Transformation: Crocs has evolved from a niche functional brand to a culturally relevant lifestyle name, focusing on product innovation and strategic collaborations to drive sustainable growth, resulting in an 11.3% increase in shares over the past three months.
Product Innovation and Market Strategy: The company is enhancing its core product lines, including clogs and sandals, while also expanding its direct-to-consumer channels and international presence, maintaining pricing discipline to protect margins.
Challenges with HEYDUDE Brand: Despite facing challenges with its HEYDUDE brand due to cautious consumer behavior and market pressures, Crocs is refreshing its product lineup to improve profitability and navigate the current market environment.
Positive Earnings Outlook: Crocs has seen strong positive earnings estimate revisions, with projected EPS growth of 5% and 8.6% for the current and next year, respectively, indicating a robust financial outlook amidst ongoing strategic efforts.
Zacks Industry Forecast for Ralph Lauren, V.F., Crocs, and G-III Apparel
Industry Trends: The textile-apparel industry is enhancing omnichannel frameworks, integrating physical and digital retail to meet consumer demand for online and hybrid shopping experiences, despite facing near-term margin challenges from increased marketing and potential tariffs.
Brand Strategies: Companies like Ralph Lauren, V.F. Corp, Crocs, and G-III Apparel are focusing on product innovation, disciplined pricing, and strategic brand investments to strengthen brand equity and capitalize on favorable market conditions.
Digital Transformation: Brands are investing in digital capabilities and customer engagement strategies, including improved mobile applications and fulfillment options, to adapt to changing consumer expectations and enhance the overall shopping experience.
Financial Performance: The textile-apparel industry has underperformed compared to the broader consumer discretionary sector and the S&P 500, with a current Zacks Industry Rank of #46 indicating positive near-term prospects, despite challenges related to input costs and shipping disruptions.
