Love is in the air – at least, for certain picks on the stock market it is.
America’s National Retail Federation says that nearly $26 billion will be spent on Valentines Day this year in the U.S. alone, representing “a new high of $14.2 billion on their significant others or spouses this year, or a record $101.84 per person.”
These numbers include a highest-ever $6.4 billion on jewellery and $4.9 billion on restaurants and ‘an evening out’, with categories of ‘flowers’ and ‘clothing’ coming in third and fourth.
And it shows up in the stock market. According to Quantified Strategies, there is a phenomenon called the ‘Valentine’s Day stock market rally’, which shows that many stocks show higher-than-normal returns in the days leading up to February the 14th each year.
So, what if you’d rather spend your V-day with trades and investments that seem likely to return the love? We’ve rounded up a list of strong contenders below.
1. Card Factory (United Kingdom)The first thing you may think of in relation to Valentines Day is cards. But, while Hallmark Cards is a private family business, another biggest name in the card gifting space is the Card Factory, across the pond in the United Kingdom.
Which is certainly worth something, as the global greeting cards market size is projected to reach $20.66 billion by 2030, according to Research and Markets’ latest greeting cards trends analysis report.
With operations in the UK, Australia and Ireland, the Card Factory is well-placed to take advantage of this future growth. Furthermore, it’s an established company, having started as a private company in the 1990s before becoming a publicly traded one in 2014.
Apart from this, Yahoo recently mentioned the Card Factory’s share price, praising the company for the fact that its share price increased by 128% in the last three years – suggesting that good things are on the cards.
2. Nestlé (Switzerland) One of the most global chocolate brands the world over, Nestlé is well-known on the stock market. However, life hasn’t been sweet lately for the chocolatier, according to our markets analyst Crispus Nyaga:
The Nestle stock price has come under intense pressure as growth of the giant food company slows. The shares have entered into a deep bear market, after falling by more than 22% from the highest point in 2023. The Nestlé share price has dropped to its lowest point since March 2022 and is below the neckline of the double-top pattern that formed in 2022. It has even retested that level, which is a good sign of a bearish continuation.”
According to Nyaga, things are likely to continue to be depressed for Nestlé, making it a good potential option for shorting – but there is a chance things could swing the other way.
Nestle shares are slightly below the 38.2% Fibonacci Retracement point and the 50-week and 25-week Exponential Moving Averages (EMA). Therefore, the path of the least resistance for Nestle is downwards, with the next point to watch being the 50% retracement point at CHF 89. A move above the resistance at CHF 100.80 will invalidate the bearish view.”
3. The Hershey Company (United States)Another potential candidate for short positions on the chocolate front is America’s the Hershey Company. However, with the brand (and, in particular, Hershey’s ‘kisses’) very strongly associated with Valentine’s Day, the company may see a temporary rebound on February 14th.
According to Nyaga, Hershey will have a tough time of it, though:
Hershey stock has been in a strong downtrend in the past few months as its growth slowed. It has dropped from last year’s high of $273 to below $200. The stock has also formed a bearish pennant pattern, a popular continuation sign. It has also remained below the 50-week moving average but has received support by the 200-day MA. Therefore, a break below the lower side of the pennant will be a sign that bears have prevailed, which will push it lower. The key target will be at $160.”
4. Uber Technologies (United States)It’s okay to think outside of the chocolate box for Valentine’s Day stocks – in fact, some of the best-known Silicon Valley heavy hitters are well placed to grow in value on February 14th.
One such example is ride sharing titan Uber, whose stock price is up more than 100% year-on-year this month, which gets a mention because of all the trips made on dates during the season of love.
This month has in fact been a particularly special one for Uber, which announced on February 7th that the company had earned a $1.6 billion net profit in the FY 2023 – representing the first time ever in more than a decade and a half that the company had made an overall annual profit rather than a loss.
And, with the company giving an important investors’ update tomorrow on February 14th itself, this one is certainly a stock to watch for intraday gains.
5. Airbnb (United States)Another brand tapped to benefit from the experiential spend on Valentines is Airbnb – and it seems to have done just that. According to a blog by the company in January, proposals at Airbnbs have more than tripled between 2018 and 2024.
Its financials are accommodating too. In its last earnings in November 2023, the company reported 18% YoY revenue growth, while free cash flow grew a sizable 37%. This is particularly impressive considering the housing crisis experienced by many regions Airbnbs are in around the world.
Also, Airbnb reports their highly anticipated Q4 2023 financial results tonight as well, for which many bullishly expect comfy earnings.
6. Kalyan Jewellers (India) One of the most pervasive jewellery brands in Asia and the Middle East, Kalyan is a brand that is well positioned to sparkle particularly brightly on Valentine’s Day, owing to the emphasis many in the Indian community place on gifting fine and demi fine jewellery on V-Day.
The century-old company became publicly traded in 2021, and its stock has more than quadrupled in value since then. Kalyan is also at an interesting juncture as a company, as it’s currently making the transition from family-run business to franchise model, which could give plenty of potential for future growth if managed right. Read more: What’s going on with the Kalyan Jewellers share price?
It’s a good buy according to Nyaga:
Kalyan Jewellers has been in a strong uptrend, rising by over 250% from its lowest point last year. It was trading at INR 366 on Tuesday as bulls attempted to retest the all-time high of INR 395. The stock has remained above all moving averages and the Ichimoku cloud indicator. The Percentage Price Oscillator (PPO) has pointed upwards above the neutral point. Therefore, the outlook for the Kalyan stock price is bullish, with the next point being at 394, its all-time high. However, a break below the support at INR 320 will invalidate the bullish view.”
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