Every year is a new ball game, and right now, we're in the early innings of 2021. Some stocks are already moving higher, and some of this year's winners are waiting to get the upticks going.
Etsy (ETSY 5.77%), Tanger Factory Outlet Centers (SKT 0.48%), fuboTV (FUBO +0.00%), and Airbnb (ABNB 2.00%) have some interesting stories to tell as this year plays out. Let's take a closer look at these four stocks to watch in 2021.
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Etsy
It'll be hard for Etsy to top its performance last year. The online arts-and-crafts marketplace operator saw its stock more than quadruple in 2020. The company was doing just fine before the pandemic hit, but the platform's popularity exploded when the perfect storm of artisans sheltering in place and consumers looking for unique and stylish face coverings resulted in a surge in orders.
Etsy went from a company that had grown its top line by 33% to 40% in four of the five previous years to becoming a rocket in 2020. Revenue would more than double in the second and third quarters of last year. There's no longer a shortage of the handmade cloth masks with unique designs that made Etsy a hot market during the pandemic, but folks continue to flock to its buzzing marketplace.
Growth will slow in 2021. The year-over-year comparisons will sting through the middle two quarters. However, analysts targeting a mere 12% increase in revenue this year are underestimating the momentum of the marketplace. The sheer increased number of merchants and shoppers that now lean on Etsy have grown substantially over the past year. It's hard to see the company not trouncing the market's ho-hum expectations in the year ahead.
Tanger Factory Outlet Centers
It didn't take long for Tanger Factory Outlet Centers to resume its dividend check-cutting ways. The operator of 38 factory outlet shopping centers announced that it's resuming its quarterly distributions earlier this month, marking its return to profitability.
Tanger's new rate is half of what it was before the pandemic temporarily shuttered its luxury discount stores, but it's still yielding better than 5% in this lousy interest-rate climate. As a real estate investment trust (REIT), Tanger will pay the lion's share of its taxable income to its shareholders. Expect the dividend to grow in 2021 if shopping picks up the pace.
FuboTV
This week is the perfect time capsule of the ups and downs that investors can expect from fuboTV in 2021. Earlier in the week, we had the most vocal bear on the live-TV streaming service lower his price target from $8 to $6.50, concerned that fuboTV will have to raise a lot money to turn its sports-wagering dreams into reality. A day later, another analyst initiated coverage of the stock with a $40 price goal.
There's a lot of room between $6.50 and $40, and my money is on the high end. FuboTV has momentum on its side. It boosted its year-end subscriber target in October and November and still blasted through those goalposts in December. With a pair of sports-gambling acquisitions being put to work in 2021, accelerating revenue, and average revenue per user widening its lead over average cost per user, it's hard to bet against fuboTV.
Airbnb
One of last year's most anticipated initial public offerings (IPOs) was Airbnb. The peer-to-peer lodging app operator has seen its stock more than double since going public at $68 last month.
Airbnb isn't at its best right now. Revenue declined 32% through the first nine months of 2020, but that was the pandemic's handiwork. A better indicator of Airbnb's potential is the 32% top-line increase it posted in 2019, or maybe even the 43% gain it posted a year earlier.
When the COVID-19 crisis passes, we're going to have money saved to travel, and Airbnb is going to cash in on the pent-up demand from folks who want to go on a trip but not stay at a crowded and sometimes stuffy hotel.
