NoBull’s Retail Same Store Sales Report benchmarks 80+ large consumer retail companies by domestic same store sales including annual (2019 – 2022) and quarterly results (2Q22 to 2Q23).
While general merchandise prices are lower y/y, they remain elevated compared to 2 years ago. As Walmart does not believe general merchandise and food (dry grocery) & consumable prices are ever going to completely disinflate, management suggests the need for a country-wide wage increase rebalancing.
Okay, Powell didn’t actually take our call, but we offer a transcript of a potential discussion between the Fed Chair and John Q. Public. It’s very insightful, so please read on.
Every investment advisor and business student knows that portfolio diversification is key to wealth building. Show me an investor who can beat the S&P 500 Index by buying a few handpicked stocks and I will show you a hedge fund manager in the making. However, there is a huge problem with this strategy that no one is talking about.
We created an index for the financial performance of 5 low-income oriented retail companies to assess the health of this demo. While we recognize that these companies have benefited from the trade-down of higher-income consumers, things look reasonable at least through calendar 2Q23.
In this post, we quantify the pressure on disposable income driven by credit card & auto loan payment increases since the onset of the Fed rate hikes in early 2022 in addition to the impact of the coming resumption of student loan payments in October 2023.
The consumer’s top-line benefits from a high employment rate, generous raises, and a healthy savings rate which indicates an income surplus.
The American youth (15 – 24-year-old) unemployment rate makes our country look downright productive compared to the rest of the world!
Post-covid U.S. exports of goods & services have skyrocketed as American companies have worked hard to onshore their supply chains, providing them with products to sell overseas. Correspondingly, U.S. imports from China have fallen considerably since late 2022 after China’s extended covid lockdowns left their American customers without product to sell.
While the U.S. has been suffering from severe post-covid inflation, China’s prices have been spiraling lower. What’s up with that?
Arby’s strong and unique positioning among $1B+ QSR chains is based upon a credible, affordable NY deli format (with a drive-thru) that bakes beef roasts and freshly slices all other roasts in-house to create fast crafted, made-to-order hot deli sandwiches. While Arby’s has a great business model, it must find ways to reach a higher income demo while it waits for an economic rebound to help its struggling lower-income core customers who love their Arby’s.
Wingstop is the only $1B+ national chain with an exclusive specialization in the chicken wing category and while the chain’s top-line performance has been remarkable so far, work remains to convince customers to extend their usage of the chain beyond a special bone-in treat to more frequent purchases of high margin boneless products sufficient to drive AUVs and store-level margins to levels appropriate for a world class wings player.
The Philadelphia Fed is forecasting +1.9% real GDP growth for 3Q23 which is significantly lower than the Atlanta Fed’s +5.9% GDPNow forecast.
FSR and QSR investor calls and same-store-sales report.
Full-year 2023 restaurant originations (excluding sale leaseback financing) are now projected to be $8.3B, -35% lower than initial expectations at the beginning of the year.
Taco Bell remains one of the best positioned QSR chains, supported by a craveable menu filled with a wide array of abundant value options, compelling brand positioning & marketing, and a material COGs outperformance which provides an important clue about TB’s secret sauce.
While Burger King is progressing in finding ways to expand its market reach towards new, more affluent consumers who are willing to pay for the brand’s strong core equities and quality upgrades, the chain’s ongoing turnaround requires more than 2 quarters of strong sales to show that it has progressed beyond its historical struggles.
2022 EBITDAR Margin was a Record Low, But EBITDAR $ Amount was 3rd Best Due to Record AUV
2Q23 Unit Level Margins Improving.
Despite an increase in the Consumer Confidence Index in July to its highest level since July 2021, it seems that consumer strength is generally softening.