FDIS: Consumer Discretionary Dashboard For February

Why It Matters

The valuation gap highlights attractive entry points for value‑seeking investors, while the concentration in a few mega‑caps raises diversification concerns for portfolio risk management.

Key Takeaways

• Consumer services undervalued ~14% versus 11‑year average
• Autos/components remain most overpriced subsector
• FDIS offers better value; XLY provides higher liquidity
• Both ETFs heavily weighted in Amazon and Tesla
• Ten consumer discretionary stocks priced below peers in February

Pulse Analysis

The consumer discretionary landscape continues to polarize, with services such as retail and entertainment showing a pronounced discount relative to historical norms. This undervaluation reflects lingering post‑pandemic spending adjustments and a shift toward digital experiences, which have bolstered profit margins for high‑quality service providers. In contrast, the autos and components niche remains stretched, pressured by supply‑chain bottlenecks and slower adoption of electric vehicle platforms, keeping its valuation elevated despite modest earnings growth.

When comparing the Fidelity MSCI Consumer Discretionary Index ETF (FDIS) to the SPDR Consumer Discretionary Select Sector ETF (XLY), investors find a nuanced trade‑off. Both funds generate similar risk‑adjusted returns over the long haul, yet FDIS trades at a slight valuation discount, making it appealing for value‑oriented strategies. XLY, however, benefits from deeper daily liquidity, which can reduce transaction costs for active traders. The shared heavy weighting in Amazon and Tesla amplifies company‑specific exposure, meaning that any earnings surprise or regulatory shift affecting these giants could disproportionately sway fund performance.

For practitioners, the February snapshot suggests a two‑pronged approach. First, consider allocating a modest portion of discretionary exposure to FDIS to capture the sector’s value tilt while monitoring liquidity constraints. Second, scrutinize the ten identified stocks that are trading below peer averages; these may present opportunistic long positions if fundamentals remain sound. Simultaneously, maintain vigilance over concentration risk, possibly by supplementing with broader consumer‑oriented ETFs or selective holdings outside the Amazon‑Tesla duopoly to achieve a more balanced risk profile.

FDIS: Consumer Discretionary Dashboard For February

Feb. 16, 2026 11:13 PM ET · Fred Piard · Investing Group Leader

Summary

• Consumer services are undervalued by about 14 % relative to their 11‑year historical averages and exhibit excellent quality scores, while autos/components remain the most overpriced subsector with the lowest quality.

• FDIS and XLY offer equivalent long‑term risk‑adjusted returns; FDIS has better value, and XLY has higher liquidity. Both are heavily concentrated in Amazon and Tesla.

• Ten stocks are cheaper than their peers in February.

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Quick Insights

• Valuation of consumer services: Undervalued by roughly 14 % versus historical baselines, with strong quality scores.

• Portfolio concentration: Both FDIS and XLY are heavily weighted in Amazon and Tesla, creating high company‑specific risk and less diversification for investors seeking balanced sector exposure.

• Long‑term performance & trading suitability: FDIS and XLY deliver similar long‑term Sharpe ratios. XLY’s superior liquidity makes it preferable for trading, while FDIS is marginally cheaper on valuation.

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About FDIS ETF

| Symbol | Last Price | % Change |

|--------|------------|----------|

| FDIS – Fidelity MSCI Consumer Discretionary Index ETF | 99.70 | +0.18 % |

| Post | 99.18 | –0.52 % |

Chart data (Feb 9 – Feb 13, 2026) shows price ranging from 99.28 to 102.44.

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Related Stocks

| Symbol | Last Price | % Change |

|--------|------------|----------|

| FDIS | 99.70 | +0.18 % |

| Post | 99.18 | –0.52 % |

Chart data (Feb 9 – Feb 13, 2026) shows price ranging from 99.28 to 102.44.

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Analyst’s Disclosure

I/we have a beneficial long position in the shares of AMZN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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