5 Solid Discretionary Stocks to Grab as Consumer Confidence Rebounds

A shrinking labor market has been a major concern among consumers lately. However, they remain confident that the situation will improve and the nation’s economy will rebound. This saw consumer confidence improving in February.

Also, the unemployment rate fell in January, and consumers are confident that inflation will ease in the near term. Given this scenario, we recommend buying five consumer discretionary stocks, namely, Rush Street Interactive, Inc. RSI, Crocs, Inc. CROX, Callaway Golf Company CALY, Dolby Laboratories, Inc. DLB and MasterCraft Boat Holdings, Inc. MCFT.

These stocks have seen positive earnings estimate revisions in the past 60 days, carry a Zacks Rank #1 (Strong Buy) or 2 (Buy), and are set for solid returns. You can see the complete list of today’s Zacks #1 Rank stocks here.

Consumer Confidence Rebounds

The Conference Board reported last week that consumer confidence rose 2.2 points to 91.2 in February from January’s upwardly revised level of 89. January’s reading was earlier reported at 84.5, the lowest level since May 2014. February’s reading comfortably surpassed the analysts’ expectation of a reading of 87.

Although consumer confidence is sharply lower than its November 2024 high of 112.8, there has been substantial progress. The Conference Board’s survey shows that concerns about a shrinking job market exist, with the share of consumers believing "jobs were hard to get" reaching 20.6, the highest level since early 2021. However, households in the survey still claim that job availability has improved, with the share believing jobs were “plentiful” jumping to 28 in February from January’s reading of 25.8.

Also, the unemployment rate fell to 4.3% in January from 4.4% in the prior month as 130,000 new jobs were added to the economy.

The consumer confidence reading comes days after the University of Michigan said its Consumer Sentiment Index climbed to 57.3 in February from the final reading of 56.4 in January, the highest level since August 2025. Investors believe inflation will ease in the coming months and boost the economy.

The short-term inflation expectation over the next year declined to a 13-month low of 3.5% in February from 4% in the previous month. Also, investors are increasingly confident that the heaviest impact of President Donald Trump’s tariffs has already passed and conditions are likely to ease going forward.

5 Consumer Discretionary Stocks With Upside

Rush Street Interactive

Rush Street Interactive, Inc. is an online casino and sports betting gaming company principally in the United States.

Rush Street Interactive’s expected earnings growth rate for the current year is 43.2%. The Zacks Consensus Estimate for current-year earnings improved 10.4% over the last 60 days. RSI currently carries a Zacks Rank #2.

Crocs

Crocs, Inc. is one of the leading footwear brands with a focus on comfort and style. CROX offers a wide variety of footwear products, including sandals, wedges, flips and slides that cater to people of all ages.

Crocs’ expected earnings growth rate for the current year is 5.7%. The Zacks Consensus Estimate for current-year earnings has improved 4.9% over the past 60 days. CROX currently carries a Zacks Rank #2.

Callaway Golf Company

Callaway Golf Company is a premium golf equipment, gear and apparel company with a portfolio of brands, including Callaway Golf, Odyssey, TravisMathew and OGIO.

Callaway Golf Company’s expected earnings growth rate for the current year is 61.9%. The Zacks Consensus Estimate for current-year earnings improved more than 100% over the last 60 days. CALY currently sports a Zacks Rank #1.

Dolby Laboratories

Dolby Laboratories, Inc. develops audio and imaging technologies that revolutionize entertainment for user-generated content, TV shows, films, music and gaming. A majority of DLB’s revenues are derived from the licensing of audio technologies. Dolby Laboratories operates on various licensing models, including a two-tier model, an integrated licensing model, a patent licensing model, recoveries and collaboration arrangements.

Dolby Laboratories’expected earnings growth rate for the current year is 1.7%. The Zacks Consensus Estimate for current-year earnings has improved 2.6% over the past 60 days. DLB currently carries a Zacks Rank #2.

MasterCraft Boat Holdings

MasterCraft Boat Holdings, Inc. designs, manufactures and markets recreational powerboats through its subsidiaries. MCFT’s operating segment consists of MasterCraft and NauticStar.

MasterCraft Boat Holdings’s expected earnings growth rate for the current year is 64.1%. The Zacks Consensus Estimate for current-year earnings has improved 21.8% over the past 60 days. MCFT presently sports a Zacks Rank #1.

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Dolby Laboratories (DLB): Free Stock Analysis Report

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Callaway Golf Company (CALY): Free Stock Analysis Report

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