By Matthew Scott ,
NEW YORK (
) -- Investors could be getting an extra sweet Valentine's Day gift this year: A gift basket of stocks primed to prosper, thanks to the projected $18.6 billion in sales the holiday is expected to generate. That would represent a 5.8% jump over last year.
The boost in Valentine's Day sales is part of the larger positive economic trend developing in the first quarter of 2011. IBISWorld retail industry analyst Nikoleta Panteva says a number of retail companies are likely to benefit from the recent surge in consumer spending.
"People are just ready to spend because consumer confidence is up," Panteva says, noting that luxury spending is also up and is becoming a strong fuel for of retail sales.
For Valentine's Day, IBISWorld projects sales of flowers to increase by 16.8%, jewelry by 11.3%, candy by 5.1%, greeting cards by 4.9%, restaurants by 3.8% and clothing, including lingerie, by 3.4%.
Among the companies that are poised to benefit most are:
: In 2010, itseasonal cards category grew by 5%, despite an overall revenue decline. This year, IBISWorld expects volume sales of its value cards segment to improve revenues as more school-age children exchange holiday cards. The stock, which closed at $21.90 per share Friday, climbed 4.27% in 2010.
: Hershey's well-known brand name and widespread product availability, along with its affordable prices, make the company a surefire winner this Valentine's Day. Sales of its Kisses and Hugs holiday-themed products will sweeten any portfolio. Shares in the king of U.S. confectioners closed at $47.04 on Friday and grew a healthy 35.32% in 2010.
: Although it has declined over much of the past five years, Zale's 2010 holiday sales were up 8%. IBISWorld expects a turnaround in middle- to upper-middle-class spending habits during Valentine's Day to help propel the company's revenues. "The middle-class demographic is getting back in the market for higher value items," Panteva says. "They are not in the highest income bracket, but they will splurge once in a while on something of high quality." Holders of Zale's stock, which closed at $4.40 on Friday, hope its 2011 performance equals its 56.62% gain in 2010.