The State Street Consumer Discretionary Select Sector SPDR ETF has underperformed significantly, down 1.2% year to date, while the S&P 500 has gained 8.6%. This divergence highlights the struggles within the consumer discretionary sector, where some stocks are lagging despite offering attractive dividend yields. Notably, 20 consumer discretionary stocks have fallen at least 20% this year but maintain yields of 2% or higher, suggesting potential opportunities for long-term investors.
Among these, Domino’s Pizza (DPZ) and Las Vegas Sands (LVS) stand out. Domino’s, down 14.4% over the past month, has faced challenges with disappointing earnings, yet it recently announced a $1 billion share repurchase program and has a solid 2.3% dividend yield, marking 14 consecutive years of increases. Meanwhile, Las Vegas Sands, down 29.6% from its 52-week high, operates primarily in Macau and is expected to benefit from a surge in tourism, despite current struggles.
Investors may find value in these lagging stocks, particularly given their dividend commitments and potential for recovery as macroeconomic conditions improve.
Source: fool.com