It’s been a great year for consumer discretionary stocks; here are the best on the ASX in 2021
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The consumer discretionary sector has been among the ASX’s best performers in 2021 and hosts many of the bourse’s best performing stocks.
This sector is home to a diverse range of companies to meal kit companies, clothing retailers, law firms, travel agents and even virtual reality entertainment providers.
Although many of these stocks were hit by the initial onset of COVID-19, most recovered quickly and some even benefited as consumers changed their spending habits.
The average consumer discretionary stock is up 28% and the ASX 200 Consumer Discretionary Index is up 20%. The ASX 200 benchmark has only gained half of this amount – 10% as of December 24.
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A significant proportion of top performing consumer discretionary stocks are companies that listed last year and have performed ever since.
The top ASX consumer discretionary stock is luxury ecommerce outlet Cettire (ASX:CTT) which is up over 600% in 2021.
It listed last year at a time when the ecommerce sector was running hot and while some companies such as Kogan (ASX:KGN) have gone back to the pack as growth slowed or supply chain issues hit, Cettire has continued to perform.
In its most recent trading update, Cettire reported a 172% gain in revenue in the four months to October 31 from $21.3 million to $57.8 million. Its active customers and number of orders both more than tripled.
Taking second place is Aquis Entertainment (ASX:AQS), a company that operates the Canberra casino. The company has had significant intraday price surges on a handful of occasions in 2021 despite having no news on those days.
In third is xReality Group (ASX:XRG) which recently changed its name from Indoor Skydive Australia (ASX:IDZ).
Its traditional business is indoor skydiving facilities but is diversifying into VR games – perfect timing in light of the hype about the so-called “metaverse” in 2021.
In fourth places is TTA Holdings (ASX:TTA) which is a distributor of TEAC brand electrical products in the Australian market and like Aquis Entertainment has gained its place off the back of intraday surges without news.
In line with the top three winners, most other ASX consumer discretionary stocks that gained operated entertainment venues or were retailers.
One particularly notable stock is Toys R Us (ASX:TOY), which was formerly known as Funtastic Furniture but acquired rights to the brand in April this year.
Even beseiged department store Myer (ASX:MYR) had a good year, gaining 48%.
One of the more peculiar winners is Propel Funeral Partners (ASX:PFP) which gained during the March 2020 crash but retreated in the rest of the year as the volume of deaths anticipated as a result of COVID – as well as the flu, thanks to social distancing – didn’t materialise.
This year Propel is up 58% as things have improved.
In the September quarter, Propel grew its revenues by 13% and performed a record number of funerals. While attendances in some markets were restricted, the company’s Average Revenue Per Funeral held the line.
The ASX consumer discretionary stock that struggled most in 2021 was AuMake (ASX:AUK) which runs brick and mortar stores aimed at Chinese tourists.
It’s not really surprising though. With tourism cut off, things have never been the same in spite of attempts to reach consumers through Chinese social media and students being allowed to return recently.
Marley Spoon (ASX:MMM), a meal kit delivery company, has likewise experienced slower growth in 2021 leading to shares plunging.
But as of December 24 it was back down to 87 cents as consumers returned to dining out once more.