Key Points
- Bank of America data shows hobby spending rose 7.9% year over year in August 2026, driven by a shift away from travel toward hobbies.
- DICK'S Sporting Goods, Hasbro, and Take-Two Interactive are three market-lagging stocks that could benefit from rising hobby and gaming spending in the fourth quarter.
- Analysts maintain notable upside price targets on all three stocks, ranging from about 24% for DICK'S and Hasbro to over 44% for Take-Two.
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Americans love their hobbies. That's what investors could take away from recent Bank of America (NYSE: BAC) data that shows hobby spending in August 2026 grew 7.9% year over year (YOY). That was more than double the 3.4% growth in transactions.
The bank attributes the spending growth to a behavior shift away from travel. Jet fuel costs are up, as is the price at the gas pump. That's made arts and crafts stores, hobby shops, and outdoor retailers the big winners.
That's actionable intelligence you can use as an investor. It could partly explain the year-to-date growth in Etsy Inc. (NYSE: ETSY), which is up over 25%. Analysts suggest there could be more room for ETSY to rise.
If this is a trend, it may be too late for investors to position for it to show up in the earnings numbers at some companies, such as ETSY.
However, there are other ways to capture this growth. Here are three hobby stocks that, unlike ETSY, are market laggards, which could present investors with significant upside in the fourth quarter.
DICK'S Sporting Goods: An Outdoor Spending Winner Priced Like a Loser
DICK'S Sporting Goods (NYSE: DKS) delivered an earnings report that showed sales growth of 5.6% and comparable sales growth of 4.9%. Sales growth, notably, was stronger on a YOY basis.
Much of this strength was attributed to back-to-school shopping for fall sports. However, DICK'S would also be a logical beneficiary of increased spending on outdoor recreational sports.
Strong sales weren't enough to help DKS, which had started to slide before the report. The company had prewarned investors of the struggles with its Foot Locker brand. The earnings report enhanced the bearish sentiment.
DICK'S has also made it clear that pricing power is not part of this story. The company cited that promotional pressure would persist through at least the fourth quarter. Other issues included excess inventory, cautious consumers, and geopolitical concerns. The company says these issues will show up most in its margins.
The consensus analyst price target of $167.21 offers about 24% upside. That's approximately 45% below the 52-week high, which may not be enough to entice investors who took profits this summer.
But for investors looking to establish a new position, this may be a good entry point, particularly as the company delivers a safe dividend that pays out $5 per share annually.
Hasbro: A Hobby Play Hiding in the Toy Aisle
Hasbro (NASDAQ: HAS) is the only stock on this list that's positive year to date (YTD). However, its 7% YTD increase still lags the broader market.
Most investors know Hasbro as a toy company. However, the fundamentals increasingly say it's a hobby company.
In its second-quarter earnings report, revenue jumped 16.2% YOY to $1.14 billion. That beat estimates by about $70 million. Earnings per share (EPS) of $1.28 also topped the $1.16 consensus.
The engine is Wizards of the Coast. Segment revenue rose 27%, led by 32% growth in Magic: The Gathering, the card game that keeps thousands of local hobby shops in business. CEO Chris Cocks argued Magic should be viewed as a mega franchise rather than a niche hobby.
Management calls the strategy "GEM Squared." It focuses on products that are gamified, entertainment-driven, multi-purchase, and multi-generational. In plain English, toys for grownups.
Hasbro raised full-year guidance. It now expects revenue growth of 5% to 7% on a constant-currency basis. It also doubled its buyback target to at least $200 million. So why does it lag the market?
Part of it is a $56 million write-down on canceled video games. Management also guided Magic lower in the fourth quarter. That's due to a tough comparison and a set launch shifting into early 2027. Several analysts trimmed price targets in July while keeping Buy ratings.
Analysts still like the story. The stock carries a Moderate Buy rating and a consensus price target of $109.50. That's about 24% upside to recent trading levels. Twelve of 16 analysts rate HAS a Buy.
The next test comes with earnings, estimated for Oct. 22. Investors will want proof that holiday toy demand can support the Magic story.
Take-Two Interactive: GTA 6 Is Your Bet on Gen-Z Gaming
If investors are looking at hobby spending as a way to broadly capture the Gen-Z crowd, they should think again. The BofA data showed that while Millennials and Gen-X consumers are increasing their hobby spending, Gen-Z is pulling back.
But one notable exception was gaming. Video game spending for Gen-Z increased by over 20% YOY. That's the core thesis for including Take-Two Interactive (NASDAQ: TTWO) on your Q4 shopping list.
But you'll need a strong risk tolerance. TTWO is down 19% in 2026 and has seen its losses accelerate even after it began accepting pre-orders for Grand Theft Auto VI (GTA VI), scheduled for release on Nov. 19.
The issue is that video games are expensive to develop, and GTA 6 is reported to be the most expensive video game ever produced. Like an anticipated movie release, it's going to take millions of sales to cover those costs.
Adding to the uncertainty, Take-Two's next earnings report is scheduled for Nov. 5. That's two weeks before the launch of GTA 6. Still, analysts have a consensus price target of $297.47 on the stock, which offers investors over 44% upside.
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