Broad Insights. Deep Analysis.

All Reports

The State of the Consumer: Some Signal and a Whole Lot of Noise

Key Points: After being steadfastly bullish on the consumer for two and a half years, we became more cautious back in July. We don’t see a major problem ahead, but our forecasts call for a considerable slowdown in spending growth. We think we’ve got the general direction right, but there’s plenty of uncertainty to go around. The data have also been a moving target, so we think it makes sense to be prepared for a

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The Distribution of Everything: Millennials, the Bottom 40%, Age-Based Forecasts

Key Points: For those interested in the distribution of things, there’s been a treasure trove of data released over the past few weeks. In this report we analyze trends using the American Time Use Survey, the Fed’s Distributional Financial Accounts, and the Consumer Expenditure Survey. We tease out important trends by age, income and generation from each of those data sets.

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In the Weeds: A Framework That Helps Us Understand What Makes Companies Tick

Key Points: This report introduces a new framework that we call “In the Weeds”. By dissecting business models into their component parts, we can understand what makes companies tick. The first iteration of the framework focuses on dollar stores, home improvement stocks, specialty retailers, and mass merchants. Over time, we intend to add other industries to our arsenal. We analyze ~25 companies on traditional metrics that include sales per square foot, operating margins, inventory turnover,

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Retail Stocks: Goods Are Back in Style. Three Unique Ways to Analyze Retailers

Key Points: Goods are coming back in style, and that’s one of the key reasons we shifted our industry weightings a few months ago – out of leisure stocks and into rate-sensitive durables. In this report, we analyze retail stocks that should also benefit from a return to spending on goods. We put forth three unique ways to analyze retailers: (i) sales per square “footprint”, (ii) inflation-adjusted same store sales, and (iii) inventory “freshness”. Sales

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What Falling Rates Mean for the Consumer. The Shift Is On

Key Points: Employment is the engine of consumption growth, and it’s shifted into low gear. The aim of this report is to determine whether monetary policy will soften the blow. We assess the effect lower rates might have on (i) the consumers’ P&L, (ii) the low-end consumer, (iii) spending on goods versus services, (iv) the housing market, and (v) home values.

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Consumer Stocks: Repositioning for the Next Phase of the Cycle

After turning more cautious on the consumer, we’ve received a lot of questions from clients. This report seeks to address those queries while adding a healthy dose of micro analysis to our macro call. We share updated thoughts on autos, RVs, housing-related stocks, staples, and leisure. We also dig into historical return profiles of consumer stocks.

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"UP-TO-DATA" PODCAST​

Tractor Supply: Without Peer. Insights from Hal Lawton, CEO

Hal Lawton joins a growing list of CEOs that’ve graced us with their presence.  He shared key insights on our podcast.  We talked about how a tight housing market pushed Millennials into TSCO’s catchment area.  We talked about TSCO’s 7% market share, and the fact that outsized comps were driven by transactions, not ticket.  TSCO has no direct peer — that means it doesn’t have to share its slice of the market with “like” competitors or fall prey to their mistakes.  Give a listen!

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Webinar: The Consumer Could Surprise in 2025

We hosted a webinar to review the state of the consumer and to detail why 2025 might hold a few surprises.  We dive into the labor markets with a focus on immigration; we assess the implications of other policies such as tariffs and taxes; we explore household balance sheets to understand how wealth and leverage might influence consumer spending.  Our take is that a softening consumer will impact the interest rate environment, and that in turn, can have meaningful implications for stock selection.  The slides…

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Brinker’s Secret Sauce. Insights from the CFO

Brinker has been on a tear.  Same store sales have been ripping even as other restaurants are struggling.  We talk with CFO Mika Ware who has a unique perspective on the company’s turnaround.  It’s a classic case of blocking and tackling — slimming down the menu, simplifying recipes, improving standards, and killer marketing that’s informed by insights and data.  It sounds like Brinker has more work to do at Chili’s, and it might be able to replicate that success with other banners.

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The More Things Change, the More They Stay the Same: Our Interview with Bill Rhodes of AutoZone

Bill Rhodes led AutoZone for nearly 20 years.  Over that time, the auto parts industry faced major change — auto cycles have come and gone, the industry has consolidated, e-Commerce has altered the landscape, and vehicles have become laden with technology.  So far, it seems that the more things have changed, the more they’ve stayed the same — AutoZone has remained relevant to its customers and its business model has stayed the course.  More change is on the horizon — EVs are making inroads, etc. …

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A Moving Target: Making Sense of the (Newly Revised) Government Data

Friday’s revision to income and spending data has caused confusion.  We’ve prepared a 10-minute podcast to review the investment implications.  Some of the changes can be disregarded as noise, but there are three important takeaways.  First, the latest iteration of personal income is highly disconnected from labor market data.  Second, this is not the first time savings rates have been meaningfully revised, nor will it be last.  Investors should move on from using the savings rate as an investable data point.  Household balance sheets are…

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A Conversation with Carol Tome, CEO of UPS

Yesterday, we caught up with Carol Tome, the CEO of UPS.  We covered a lot of ground … as UPS typically does!  We talked about the state of the global supply chain, the shift between goods and services, the de minimis rule, tariffs, UPS’ relationship with Amazon, the labor market, driverless vehicles, drones, AI, and more.  Click the link to view our 20-minute interview.  So far, we’ve hosted the CEOs of Delta, Home Depot, and UPS.  There’s more to come.  Sign up for our podcast…

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