(Story updated to add that Tiffany recently raised its fiscal 2012 earnings outlook.)
BOSTON ( TheStreet) -- Consumer-discretionary stocks, led by auto makers, restaurants and retailers, and their suppliers, have been among the top performers coming out of the recession, and it looks like this year will be no exception.
Those shares were up 15.7% through the end of the first quarter, versus the S&P 500's 12% gain, outdone only by information-technology stocks, which gained 20.8%, and financials, up 19.8%.
"This comes after three consecutive years of relative strength for the consumer-discretionary sector through the end of 2011, during which it outperformed the broader market index by an average of more than 1,100 basis points per year," said Tuna Amobi, an S&P Capital IQ equity analyst, in a research note. It appears that the consumer is willing and able to spend, so this train could gather speed as employment and consumer confidence pick up on continued positive economic news. "Looking ahead, increasingly favorable macroeconomic and fundamental underpinnings could help several of the sector's highly cyclical constituents to sustain their relative strength in the year ahead," said the S&P note. "Overall, we expect gradual but steady improvement in consumer confidence, spending, jobs growth and other macroeconomic variables to help support our continued favorable outlook for the consumer discretionary sector." Job growth is one of the key fundamentals. February's job numbers were released Friday with a disappointing 120,000 jobs added, although the unemployment rate ticked down to 8.3% from 8.4%. "Even against a relatively high unemployment rate, recent monthly gains in the job market should bode well for incomes and purchasing power," said S&P, as consumer spending and disposable income recently notched sequential monthly improvements. In highlighting the consumer-discretionary sector's performance, S&P listed its 12 top picks. Four of the 12 are major players in the auto industry, three are in media and entertainment, and two are retailers of luxury goods, the latter a sub-sector that has done well throughout the recession and into the recovery. Here are summaries of 12 consumer discretionary stocks rated "strong buy" by Standard & Poor's, ranked in inverse order of returns this year:
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