Three stocks to play as student loan repayment slashes borrowers’ budgets, Jefferies says

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The suspension of student loan repayments ends next week, and budget-conscious shoppers will likely trade down.

Federal student loan payments are coming back in October – and a trio of stocks are set to shine as borrowers cut their spending, according to Jefferies. Payments on federal student loans had been paused since March 2020 as part of a package of Covid-era relief measures. Interest on these debts resumed accruing on Sept. 1. Those payments will likely put a dent into borrowers' budgets. A recent poll of about 630 U.S.

"WMT has a degree of downside protection due to potential trade-down," the firm noted. "And TJX remains best-positioned within the off-price space." Walmart beat Wall Street's estimates for sales and earnings in its fiscal second quarter and hiked its full-year earnings forecast. Shares of the big-box retailer are up 15% year to date, but analysts' average price target suggests nearly 10% upside from here, according to LSEG. TJX , the parent of T.J.

 

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