02:58 PM EDT, 03/23/2026 (MT Newswires) -- US softline retailers are likely to post better-than-expected earnings this year as consumer spending intentions continue to be "good" despite geopolitical and other headwinds, UBS Securities said Monday.

The brokerage maintained its bullish outlook on the industry despite a deceleration in consumer spending intentions month over month amid worries about the potential negative impact of the conflict in the Middle East on demand.

UBS said it sees more upside than downside to Wall Street's 2026 per-share earnings estimates for softline stocks.

"New March survey data shows US consumer apparel and footwear spending intentions remain good and only moderately negatively impacted (month on month) by recent macro news and events," UBS analysts Jay Sole and Mauricio Serna said in a note to clients. "Furthermore, we believe investors' concerns are mostly priced in."

Inflation and tariffs are the top two factors negatively affecting consumers' view of the US economy, the brokerage said, citing the survey.

The US-Israel war with Iran started at the end of last month and has impacted several countries in the Middle East. It has resulted in the closure of the key Strait of Hormuz, igniting oil-driven inflation concerns.

On Monday, President Donald Trump said the US will not attack Iran's energy infrastructure for five days amid ongoing talks between the two countries.

"We believe ongoing macro volatility has reduced softlines investors' risk appetite," Sole and Serna said. "As a result, our sense is investors are increasingly sticking to the most defensive, highest-quality stocks." These include TJX (TJX), Ross Stores ( ROST ) , Tapestry (TPR), and Ralph Lauren ( RL ) , according to the note.

UBS said that although it also likes TJX and Ralph Lauren ( RL ), it sees a wider set of buy opportunities than most investors do. These include On (ONON), Deckers Outdoor ( DECK ) , and Burlington Stores ( BURL ) .

The brokerage said it likes these stocks over Nike ( NKE ) , Lululemon Athletica ( LULU ) , Macy's (M), Kohl's (KSS), and Dillard's (DDS).

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