Tapestry, ThredUp and Under Armour are some of Wells Fargo's top softlines picks
Vertigo3d/E+ via Getty Images


Wells Fargo is optimistic on the retail softlines sector even as it sees some tough sledding due to ongoing supply chain and inflation pressures. For investors, the firm thinks that it is time to get bullish again after the late 2021 underperformance in share price.

Analyst Ike Boruchow: "While we acknowledge that early 2022 likely will be challenging given the lapping of stimulus driven top-line compares and record margins (a tough catalyst path lies ahead through April), we see the market beginning to look past these concerns and bracing for a much improved 2H22 setup early in the year."
Wells Fargo calls out its top sector picks - Tapestry (NYSE:TPR), Capri Holdings (NYSE:CPRI), Bath & Body Works (NYSE:BBWI), Signet (NYSE:SIG), Farfetch (NYSE:FTCH), ThredUp (NASDAQ:TDUP), Academy Sports and Outdoors (NASDAQ:ASO) and Under Armour (NYSE:UAA).
Meanwhile, the firm sees a tough setup for Ross Stores (NASDAQ:ROST) amid deepening concerns on the strength of the low-end consumer. ROST is downgraded to Equal-weight from Overweight.
See which consumer discretionary stocks have the highest Seeking Alpha Quant Ratings.