Rising Wage Trends Set to Boost These Six Stocks: Insights from Jefferies

Jefferies highlights that numerous consumer-focused companies stand to gain from increasing wages across several advanced labor markets worldwide. Industry leaders such as luxury retailer Tiffany & Co. (TIF) and e-commerce powerhouse Amazon.com Inc. (AMZN) are well-positioned to capitalize on the pressure companies face to raise employee compensation amid tightening labor conditions.

Analyst Sean Darby from Jefferies observes an emerging wage cycle taking shape in countries including Japan, the United States, the Netherlands, and Germany.

Darby adds, "We believe that companies are finally reinvesting their profits back into their economies, which increases the likelihood that a broader range of consumer-focused businesses will benefit."

Below are six stocks, already experiencing significant growth, that Jefferies expects to gain further momentum from these global wage dynamics:

1. Amazon.com Inc.

Amazon’s shares have surged over 100% in the last 52 weeks and climbed 62% year-to-date. The leading online retailer posted $52.9 billion in second-quarter revenue, with its cloud division growing nearly 49% year-over-year to $6.11 billion. (See also: Amazon Projected to Reach $2.5 Trillion Market Cap by 2024: MKM.)

2. Gap Inc. (GPS)

While Gap has faced challenges competing with online retailers, its affordable clothing lines, particularly Old Navy, have strengthened its position recently. Despite reporting underwhelming earnings, Gap’s global presence positions it well to benefit as consumers gain additional disposable income. Gap shares have increased 28% over the past year but are down 12% year-to-date.

3. Michael Kors Holdings Limited (KORS)

Michael Kors, targeting the luxury segment, continues to expand globally despite competition from brands like Kate Spade and Coach. The stock has risen 78.2% over the past year and 18% year-to-date. (See also: 4 Underappreciated Blue Chip Winners.)

4. Kohl’s Corp. (KSS)

Kohl’s shares have climbed 109% in the last 52 weeks and 48.4% year-to-date. The department store chain’s second-quarter profits jumped 40% to $292 million, driven by strategic efforts to reduce store footprint and share space with partners such as Aldi and fitness centers. Revenue increased 4% to $4.57 billion.

5. Under Armour Inc. (UAA)

Under Armour’s stock is up 27.9% over the past year and 50.2% year-to-date. The company saw a 28% revenue increase internationally in Q2, fueled by strong performance in Europe and Asia, with overall revenue rising 8% to $1.18 billion. (See also: Under Armour’s Stock Poised for Major Gains.)

6. Tiffany & Co.

Scheduled to release second-quarter earnings on August 28, Tiffany previously reported first-quarter results that significantly exceeded expectations. The luxury jeweler benefits from its strong global brand during periods of increased consumer spending. Tiffany shares have gained 46.3% this year and 24.9% year-to-date. (See also: 5 Retail Stocks to Watch as the Economy Accelerates.)

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