In this article, we will take a look at the 10 Best Consumer Cyclical Stocks to Buy Now.
Companies in the consumer cyclical sector produce products and services that are considered non-essential, so people are more inclined to buy them when they have extra money or are comfortable with their financial status. As a result, these companies, subject to consumer discretion, often face cyclical pressures.
Following a peak in April, concerns around a recession seem to have significantly cooled. After a 90-day tariff break and trade talks with China were announced, the probability of a recession dropped from 66% to 28% on prediction market Polymarket. That said, a 28% likelihood of recession is still higher than the long-term average of about 15%, which continues to worry some Wall Street traders.
According to a Commerce Department report released on June 27, consumer prices rose slightly in May, and the annual inflation rate moved further away from the Federal Reserve’s goal. Core PCE, excluding food and energy, reported readings of 0.2% and 2.7%, respectively, which were lower than the projections of 0.1% and 2.6%.
In addition to the inflation figures, there were indications of continued declines in consumer income and spending. In comparison to the projection of a 0.1% increase, spending decreased by 0.1% for the month. However, the markets did not react much to the data as Treasury yields increased and stock market futures showed a favorable start on Wall Street.
Our Methodology
To compile our list of the best consumer cyclical stocks to buy, we started with a list of U.S.-listed companies in the industry with strong fundamentals. We used the finviz screener to get companies operating in the cyclicals space. We then ranked them according to the number of hedge funds that held stakes in them as of the first quarter of 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
10. Smurfit Westrock Plc (NYSE:SW)
Number of Hedge Fund Holders: 37
Smurfit WestRock Plc (NYSE:WRK) is one of the best consumer cyclical stocks to buy. Jefferies raised its price target for Smurfit WestRock Plc (NYSE:WRK) from $44 to $55 on June 16 and upgraded the firm to Buy, citing increased confidence in the company’s commercial execution and integration of WestRock.
According to Jefferies’ 2025 projections, Smurfit WestRock Plc (NYSE:WRK) is trading at a substantial discount to some of its competitors. As Smurfit meets synergy goals and increases investor transparency, the brokerage believes this difference will begin to close. Alongside an additional $400 million in cost reductions, the company’s management anticipates at least $400 million in commercial synergies from its North American box business.
Moreover, Smurfit WestRock Plc (NYSE:WRK) has moved away from WRK’s volume-first philosophy under the new leadership, assigning profit-and-loss duties to box plant managers and linking compensation to free cash flow and EBITDA.
Smurfit Westrock Plc (NYSE:SW) is a global leader in the paper packaging sector, manufacturing a variety of products, including retail displays and shipping boxes. The company operates box facilities and paper mills in 40 countries, giving it a significant global presence.
9. The Gap Inc. (NYSE:GAP)
Number of Hedge Fund Holders: 41
The Gap Inc. (NYSE:GAP) is one of the best consumer cyclical stocks to buy. On June 18, TD Cowen maintained its Buy rating on The Gap Inc. (NYSE:GAP) while cutting its price target for the clothing retailer’s shares from $31 to $29.
Although the market undervalues the longevity of Gap and Old Navy, the firm believes that topline growth and margin expansion could be fueled by Banana Republic and Athleta’s potential comeback. TD Cowen stated that if consumer spending remains steady, there might be positive developments for the rest of the year.
According to TD Cowen, Gap’s improved fundamentals could lead the stock price to multiple expansion in the stock price. Additionally, the firm sees an opportunity for upside in Gap’s fiscal year 2025 projection, especially when it comes to tariff impacts.
A specialized retailer in the United States, The Gap Inc. (NYSE:GAP) offers clothing, accessories, and personal care products for men, women, and children. Some brands that fall under its umbrella include the likes of Athleta, Gap, Banana Republic, and Old Navy.
8. CAVA Group, Inc. (NYSE:CAVA)
Number of Hedge Fund Holders: 41
CAVA Group, Inc. (NYSE:CAVA) is one of the best consumer cyclical stocks to buy. On June 18, Stifel maintained its Buy rating on CAVA Group, Inc. (NYSE:CAVA) shares but reduced its price target to $125 from $175.
Citing challenging comparisons following Grilled Steak’s debut last year, the firm lowered its second-quarter same-restaurant sales growth projection to 5.5%, below the Street expectation of 6.9%.
However, despite the near-term adjustment, CAVA’s prediction for a three-year stack in the high 30% range is consistent with Stifel’s full-year same-restaurant sales growth estimate of roughly 7%.
Stifel determined that average unit volume growth, margin expansion, and unit growth were the three main drivers of CAVA’s longer-term valuation. The firm believes that, should brand recognition increase, average unit volumes will probably climb faster than expected.
CAVA Group, Inc. (NYSE:CAVA) is a fast-casual Mediterranean restaurant chain that focuses on adaptable meals. It operates company-owned locations and produces branded retail items through its vertically integrated model.
7. Rivian Automotive, Inc. (NASDAQ:RIVN)
Number of Hedge Fund Holders: 41
Rivian Automotive Inc (NASDAQ:RIVN) is one of the best consumer cyclical stocks to buy. On June 16, Cantor Fitzgerald maintained its Overweight rating and $15 price target on Rivian Automotive Inc (NASDAQ:RIVN). This follows the company’s recent debt refinance announcement.
Rivian Automotive Inc. (NASDAQ:RIVN) stated on June 2 that it would raise $1.25 billion through a private offering of green notes that are due in 2031. The notes would be secured by its New Horizon assets and guaranteed by company assets when the Department of Energy funding is obtained. The company plans to use the proceeds of this capital transaction in addition to its current cash reserves to fully repay its current $1.25 billion floating-rate notes that mature on October 15, 2026.
Separately, Rivian Automotive Inc. (NASDAQ:RIVN) has considered selling high-yield bonds under the direction of JPMorgan in order to generate up to $2 billion for the refinance of its debt maturing in 2026.
Rivian Automotive Inc. (NASDAQ:RIVN) is an automotive company that specializes in the design, development, production, and distribution of electric vehicles and associated accessories.
6. Wayfair Inc. (NYSE:W)
Number of Hedge Fund Holders: 43
Wayfair Inc. (NYSE:W) is one of the best consumer cyclical stocks to buy. Analysts at TD Cowen began coverage of Wayfair Inc. (NYSE:W) on June 5, assigning a Buy rating along with a $51 price target on the company’s shares. The analysts voiced optimism about the company’s future, citing its standing as a top supplier of SaaS products for healthcare providers.
According to TD Cowen’s research, Wayfair Inc. (NYSE:W) is well-positioned for future growth owing to its emphasis on intricate billing procedures and rising out-of-pocket patient expenses. These elements, according to the analysts, will propel the company’s expansion in the upcoming years.
Much attention was also paid to Wayfair’s first-quarter earnings, with a number of analyst firm’s offering their opinions on the company’s performance and prospects. Needham, which kept its Buy rating but reduced its price target to $40, pointed out that Wayfair’s results came above projections due to enhanced margins and efficient cost control.
Wayfair Inc. (NYSE:W) is an American online retailer that offers furnishings and household goods. The company runs a number of brands, including Joss & Main, Birch Lane, AllModern, and its main Wayfair store.
5. Etsy, Inc. (NASDAQ:ETSY)
Number of Hedge Fund Holders: 47
Etsy, Inc. (NASDAQ:ETSY) is one of the best consumer cyclical stocks to buy. On June 17, Truist Securities maintained its Buy rating on Etsy, Inc. (NASDAQ:ETSY), but increased its price target to $60 from $55.The price target rise follows after Truist Card Data revealed that Etsy’s Marketplace revenue quarter-to-date through June 11 is exceeding forecasts.
Truist also observed a surge in the number of monthly active users, which increased year-over-year and reached its highest level in 22 months. This indicates that the company’s growth activities are having a favorable impact. Along with increased marketing effectiveness that has allowed Etsy, Inc. (NASDAQ:ETSY) to win more ad auctions, these efforts also include improvements in product quality, particularly discoverability and quality score.
Etsy, Inc. (NASDAQ:ETSY) operates two-sided online marketplaces that link millions of creative customers and sellers globally. The company manages Reverb, Depop, and Elo7 in addition to its main marketplace, Etsy, which specializes in unique and creative products.
4. O’Reilly Automotive, Inc. (NASDAQ:ORLY)
Number of Hedge Fund Holders: 58
O’Reilly Automotive (NASDAQ:ORLY) is one of the best consumer cyclical stocks to buy. On June 18, DA Davidson maintained its Buy rating on O’Reilly Automotive (NASDAQ:ORLY) while reducing its price target to $107 on the company’s shares.
The firm claims that O’Reilly’s 15-to-1 stock split, which went into effect on June 10, is reflected in the price target revision. DA Davidson stressed that under its revised model, no additional adjustments were made to its financial assumptions for the company.
Additionally, O’Reilly Automotive recently issued its first-quarter 2025 earnings, which fell short of both revenue and earnings per share projections. The company’s revenue of $4.14 billion lagged behind the $4.18 billion expectation, and its earnings per share of $9.35 fell short of the projected $9.87.
However, despite these results, O’Reilly Automotive Inc. (NASDAQ:ORLY) raised earnings per share guidance by about 1% and maintained its full-year revenue guidance between $17.4 billion and $17.7 billion.
Serving customers as well as and professional installers in the US, Mexico, and Canada, O’Reilly Automotive Inc. (NASDAQ:ORLY) is a leading provider of automotive components, tools, and supplies.
3. Maplebear Inc. (NASDAQ:CART)
Number of Hedge Fund Holders: 64
Maplebear Inc. (NASDAQ:CART) is one of the best consumer cyclical stocks to buy. On June 23, Citizens JMP maintained its price target of $55 on Maplebear Inc. (NASDAQ:CART) alongside a Market Outperform rating. Instacart’s recent delivery service collaborations with YouTube, TikTok, and OpenAI were noted by the research firm as significant factors in its analysis.
According to Citizens JMP, Maplebear Inc. (NASDAQ:CART) is establishing itself as the grocery supplier for “next-generation consumer product discovery surfaces,” including social media and search engines driven by artificial intelligence. One of Instacart’s key advantages, according to the firm, is its “tendency to be a first mover” in the industry.
With a reported 14% increase in IC+ membership growth year over year, Maplebear Inc. (NASDAQ:CART) has been performing well lately. Advertising revenue has been on the rise, and the company’s $10 threshold for free delivery has been beneficial in generating further orders.
Maplebear Inc. (NASDAQ:CART), also known as Instacart, provides a grocery delivery platform that is well-known throughout the United States, with over 600,000 drivers and a network of about 8 million monthly active customers.
2. General Motors Company (NYSE:GM)
Number of Hedge Fund Holders: 79
General Motors Company (NYSE:GM) is one of the best consumer cyclical stocks to buy. TD Cowen reaffirmed its Buy rating for General Motors Company (NYSE:GM) on June 18. The update came together with increased U.S. Seasonally Adjusted Annual Rate (SAAR) projections for 2025–2027, which predict low-single-digit growth in industry revenue during this period.
According to TD Cowen, GM is the “top pick” among automakers owing to its substantial exposure to possible favorable results for U.S. auto demand. Despite recognizing higher macroeconomic risks, the firm’s analysis shows above-consensus estimates.
The firm noted a number of potential catalysts for General Motors Company (NYSE:GM), such as the return of share buybacks, additional positive estimate revisions, and possibly improving attitudes regarding autonomous vehicles and software.
General Motors Company (NYSE:GM) is a prominent multinational automaker dedicated to manufacturing and distributing cars, trucks, crossovers, and auto parts and accessories across the globe. The company is in charge of well-known brands such as Holden, Baojun, Wuling, Cadillac, Buick, and GMC.
1. Carvana Co. (NYSE:CVNA)
Number of Hedge Fund Holders: 90
Carvana Co. (NYSE:CVNA) is one of the best consumer cyclical stocks to buy. On June 10, analyst Michael McGovern of BofA Securities reiterated his Buy rating on Carvana Co. (NYSE:CVNA) while raising the price target for the company’s shares from $325 to $375. Despite potential challenges in the second half of the year due to tightening new car supply shipments noticed in May, McGovern listed a number of variables that could support the company’s continued growth.
McGovern also noted that Carvana Co. (NYSE:CVNA) could benefit from the trend of consumers switching from new to used cars, which the company might take advantage of to increase its market share. He added that even though the S&P Committee made no adjustments this quarter, Carvana Co. (NYSE:CVNA) is now qualified to be included in the S&P 500 index.
Carvana Co. (NYSE:CVNA) is an online retailer of used cars based in Tempe, Arizona. Renowned for its multi-story automobile vending machines, the firm is the fastest-growing online used car dealer in the United States.
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Disclosure: None.
