Christmas gift companies – should they be in your investment stocking this year?

 
As investors make final preparations for Christmas, Angeline Ong, Analyst and Presenter at investment and trading platform IG, outlines the investment case for ten companies associated with Christmas gift sales. She assesses their year-to-date performance, strength of consumer demand, and key market headwinds and tailwinds. Angeline also outlines the best entry/exit points for some of companies, while noting which should be considered as dividend stocks.
 

Estée Lauder, up 21% YTD — cosmetics — Estée Lauder’s share price looks ugly if you compare it to the highs hit in early 2022, but the stock now looks like it is starting to benefit from a makeover. The company’s turnaround plan, centred on innovation and strategic brand growth, saw Q1 sales beat the Street. Le Labo and Tom Ford fragrances rose, and the Clinique and Jo Malone London owner saw its quarterly organic net sales jump 3%. Plus, with the weakness in the China market now easing, Estée’s stock, like its tagline, could be “beauty reimagined.”

Indicators suggest: Buy into Q1

Revise position if: China demand weakens, organic sales disappoint
 
EA, up 28% YTD — gaming — Electronic Arts stock has been a 2025 rocket ride, but don’t bet on more fireworks — the party could be winding down as folks ditch screens for real-life hangouts post-pandemic. Sales keep climbing, yet they’re getting weighed down by the “get-outside” vibe enticing gamers away. Analysts are, on average, betting on 4.6% revenue CAGR and 12.7% EPS CAGR through 3–5 years, thanks to live services and esports. Catalysts include Battlefield 6 revival, Star Wars: Zero Company, and mobile expansions.
 
Indicators suggest: Buy as long as price action stays above 20 and 50 EMA.
Revise position if: Delayed releases mute growth.
 
L’Oréal, up 7% YTD — cosmetics — L’Oréal’s shares hit a summer high in Aug/Sept 2025 and have formed a descending channel since then. While the stock has outperformed the CAC on a YTD and one-year return basis, price action is struggling to stay above the 100- and 200-day EMAs, suggesting the market continues to weigh L’Oréal’s strong brands, including Lancôme, against the company’s high marketing costs and the threat of clean-beauty startups.
 
Indicators suggest: Sell
Revise position if: Softness in Western Europe, U.S., and China start to lift. 
 
Hershey, up 10% YTD — chocolate — The maker of the “Great American Chocolate Bar” has focused on blending nostalgia and BFY (better-for-you) products to stay on trend. Hershey has also made a strong push into Reese’s product extensions to counter higher cocoa prices. Its debt-to-equity ratio is approximately 1.2 (high versus the industry average of about 0.6), driven by acquisitions. Indicators suggest: Hold for dividends/moat; Buyon dips to $160 for defensives; but the stock looks overvalued as a standalone.

 
Build‑A‑Bear, up 29% YTD — toys — Well done if you held Build‑A‑Bear through a rollercoaster 2025! The specialty retailer focused on interactive plush-toy experiences has shown resilient performance in a challenging retail environment, driven by nostalgia marketing, e-commerce growth, and experiential store expansions. Build‑A‑Bear’s sector momentum outweighs insider noise, positioning it for steady gains in a nostalgia-driven “kidult” market. In portfolio terms, BBW’s dividend looks better suited as a growing, “safer” component of a total-return story rather than a core income anchor, especially compared to mature, high-yield cyclical names.
 
Indicators suggest: Sell
Revise position if: Tariff related costs lift, general expenses fall.
 
Hasbro, up 40% YTD — toys — Hasbro goes into 2026 as a restructuring, IP-leveraged toy and gaming play where upside hinges on execution in Wizards of the Coast/digital and margin recovery. Key risks: cyclical toy demand and tariffs.
 
Indicators suggest: Sell
Revise position if: Margins improve, tariff headwinds ease, demand picks up

Apple, up 8.5% YTD — tech — Despite concerns about an AI bubble, Apple remains a strong, cash-generating, mature company with a proven ability to navigate cycles. The company has, however, been criticized for not being innovative enough and “being late” to the AI game.
 
Indicators suggest: Some valuations appear “full,” meaning further gains may be limited if growth disappoints. For a medium-term investor, buying on dips to the mid-$260s and holding with a view to the mid-$300s could be a pragmatic
 
Indicators suggest: Buy
Revise position if: Revenue growth falters, sales in China fall, lack of AI roadmap
 
AB InBev, up 12% YTD — beer — While AB InBev’s shares have fizzed higher since September, they’re nowhere near the highs seen at the start of summer 2025. The maker of brands including Corona and Stella Artois saw its shares tank in July as sales slid in China and Brazil. The key concern remains weak beer consumption — as long as volumes stay low, this stock is likely to struggle.
 
Indicators suggest: Sell
Revise position if: Beer volumes improve.
 
Burberry, up 15% YTD — luxury — There are early signs that the iconic trench‑coat maker is making a comeback. Comparable store sales have risen for the first time in two years, margin controls are improving, and the strategy of returning to “classic British luxury” rather than over-diversifying may restore brand desirability in 2026. Given macro and luxury‑sector headwinds, reflected in Burberry’s price action, this feels more like a turnaround or speculative recovery play rather than a high-growth stock for now.
 
Indicators suggest: Hold if this is a dividend play for you. If not, Sell.
Revise position if: Burberry’s breaks out above the July 2025 high.
 
Kering, up 26% YTD — luxury — Kering’s shares have outperformed the CAC on a YTD basis, even though they topped out in October. The stock may look like it’s recovering… until you compare it to the highs of summer 2021. Its core brand, Gucci, remains weak. Given this, along with macro and luxury-sector uncertainties, investors could look to buy the dip around the €260–€280 zone, which offers a margin of safety if the macro backdrop sours or Kering’s turnaround progress is slower than expected.
 
Indicators suggest: Hold. If you already hold Kering but are looking for an exit (profit-taking) zone, keep an eye on price action reaching the €330–€350 range, especially if underlying sales remain weak or sector headwinds return.
Revise position if: Macro headwinds worsen, Kering’s turnaround plans stumble. 

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