This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

12 Highest-Rated Consumer Stocks Picked by S&P (Update1)

(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:

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,122.01 +15.31 0.09%
S&P 500 2,000.12 +0.10 0.00%
NASDAQ 4,569.6210 -1.0160 -0.02%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs