Lesser-Known Clothing Stocks

3 Lesser-Known Clothing Stocks For Investors To Buy Right Now

Despite the pandemic, the apparel industry is thriving right now; nevertheless, finding the right stocks to buy can be very challenging.

The clothing industry is on the rise amidst the ongoing pandemic recovery. According to the U.S. Census Bureau, clothing and accessory sales were among the retail sectors’ fastest-growing segments this year. Due to COVID-19, the majority of fashion firms increased their use of e-commerce in a bid to raise sales. Here are the top three clothing stocks that are causing a stir this fall season.

1. J.Jill Inc.

J.Jill Inc. (NYSE: JILL) is a renowned, multi-channel, female-focused retailer brand in the U.S. The firm embodies the confidence of remarkable women that inspired its clothing line, which symbolizes joy, passion, and purpose. Shopping can be done at any of the company’s 265 stores or on its robust e-commerce platform.

In early July, the company released its Q1 earnings, stating that total net sales increased by 42% when compared to the same period in 2020. Furthermore, the company’s gross profit was $87.8 million, up from $50.2 million in fiscal 2020’s first quarter.

Claire Spofford, President and Chief Executive Officer of J.Jill, mentioned positive trends in Q2:

As we enter the second quarter, we are pleased with the momentum we are seeing in the business especially over the strong Mother’s Day weekend. Looking ahead, we expect to build on the progress we are making as we refine our operating model and drive efficiencies across the business.

Jyothi Rao, a new member of the board of directors, was introduced by the organization in mid-July. Rao’s high-end fashion expertise and backgrounds are a perfect fit for the company’s existing directors’ brand and vision.

The COVID-19 pandemic had an impact on the company’s future developments, both regionally and globally, resulting in the closure of two stores as of May 1, 2021. The firm believes that strategies are aimed at improving the present operating model and generating substantial margin expansion would help it make momentum.

2. Lakeland Industries Inc.

Lakeland Industries (NASDAQ: LAKE) is a U.S.-based global manufacturer that produces protective clothing for several industries, including healthcare and first responders at federal, state, and local levels.

Early in July, the company announced a $5 million expansion to its stock repurchase program. The company has repurchased approximately 227,454 shares since May 1, 2021.

From Lakeland Industries’s recent press release:

“It has significantly expanded its credit facility with Bank of America in support of its capital allocation strategy focused on inorganic corporate developments and other growth initiatives.”

Its secured revolving credit facility expands its borrowing capacity from $12.5 million to $25.0 million. With $60.3 million in cash on April 30, 2021, the Company has not drawn down on its credit facility and remains debt-free.

The pandemic caused a significant increase in demand for personal protective equipment (PPE), resulting in a boom for the industry as well as record sales and profits over the past year.

3. Zumiez 

Zumiez (NASDAQ: ZUMZ) is a prominent store for apparel, footwear, and accessories for young consumers who seek stylish, cultural, and artistic ways to express their personalities. The brand focuses on a varied collection of brands that can readily reflect current trends in fashion. 

It has 735 outlets in the U.S., Canada, Europe, and Australia. The company also provides a number of e-commerce sites.

The company’s financial position appears to be stable, with net sales up by 102.6 % to $279.1 million in the Q1 of 2020. Unfortunately, the company did not provide any Q2 projection this year due to unclear revenue consequences.

As the U.S. continues to recover from the pandemic, American malls are likely to attract a wave of reinvigorated consumers, particularly teenagers, which bodes well for business. The company’s future plans include shifting the majority of business distribution to the web and reducing dependence on its physical stores. This would significantly reduce the company’s rental costs, allowing it to spend more on other production or administration resources.

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