The pandemic changed the landscape of retail investment, whether you invested in the best retail stocks, grocery store stocks, home improvement stocks or e-commerce stocks. It benefited some retailers and left others completely in shreds. E-commerce became even more prevalent once people stopped going to stores and spent money on home improvement and video games instead of earmarking money for travel or social activities.
Retailers, including specialty retailers, have also faced excess inventory due to rising inflation, mostly due to cutbacks by consumers. The aftereffects of the pandemic paved the way for online suppliers and unfortunately, for many retailers, they no longer hold customers in the palm of their hand like they did, say, in the 1990s. Retailers who can differentiate themselves often end up thriving the most.
However, it's possible to find good retail stocks by identifying key metrics that show proof strength. We'll go over key indicators of strength in the next section.