(This story is for CNBC Pro subscribers only.) A partial reopening of the economy is boosting investor sentiment, with certain retailers set to benefit from the first wave of consumers emerging from the coronavirus shutdown. Bank of America said buy-rated Burlington Stores , Ross Stores , Five Below and TJX Companies should benefit the most from early reopeneing due to their off-mall locations and lack of e-commerce penetration. Shares of Burlington and TJX popped more than 2% in premarket trading on Wednesday and Ross Stores rose about 1.8%. "Stores located off-mall are likely to see early benefits from reopening as consumers avoid crowded malls," Bank of America equity analyst Lorraine Hutchinson said in a note to clients. Retail has been one of the most beaten-down industries during the coronavirus pandemic. With a government mandated shutdown of the economy, physical retailers were forced to shut their doors with little or no way to make revenue but large rents to pay. But stay-at-home orders in a handful of states, specifically in the Southeast of the U.S.— like Georgia, South Carolina and Texas — are expiring, creating a new "normal" for the shopping experience, the firm said. Shares of retailers have soared in recent days in hopes a reopening of the economy will save the battered industry. The S & P Retail ETF (XRT) has rallied more than 10% in the past week. Mall based retailers are the most at risk as shoppers will likely opt for easier online or off-mall shopping environments, said Bank of America. The firm sees uncertainty for Macy's , Nordstrom , Gap and American Eagle Outfitters . Bank of America also said the stores need to determine if they can generate enough sales to cover the costs of running the stores. "Opening a store will require bringing back furloughed employees and paying rent (for those who stopped while stores were closed)," added Hutchinson. "We think in many cases, they will open because the increased ability to clear through excess inventory is crucial to not only improve working capital but also make room for Back to School and Fall inventory which will arrive mid-late summer." Hutchinson said the U.S. will have more pent-up consumer demand than Asia, as their lockdowns were shorter-lived. "We think the longer lockdowns have created a much more difficult macro environment in the US, and expect a slower ramp once stores open," Hutchinson said. The Wall Street firm noted that retailer have "a lot of work to do before reopening." "Some examples are procuring adequate masks and supplies for store associates, placing six feet markers throughout the store, installing shields in front of cashiers, setting social distancing rules, establishing a more frequent cleaning schedule and limiting the number of customers inside at a time," said Hutchinson. Global brands like PVH, Ralph Lauren, Levi Strauss and Tapestry will have the advantage of using their successful practices established in Asia, the original epicenter of the coronavirus. — with reporting from CNBC's Michael Bloom.
A shopper carries a bag outside a TJ Maxx store in New York, U.S.
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(This story is for CNBC Pro subscribers only.)
A partial reopening of the economy is boosting investor sentiment, with certain retailers set to benefit from the first wave of consumers emerging from the coronavirus shutdown.