Summary Points Consumer staples have been a great place to hide. Over the past 12 months, the stocks have outperformed the broader market by +25 percentage points, one of the best stints on record. On a multi-year basis, the sector’s performance is nothing to write home about. The question we pose in this report is where the staples stocks will go from here? It’s hard to separate a view on staples from one’s macro-economic outlook.

Summary Points: Managing inventory is a tough balancing act in normal times. Over the past few years, it’s been a nightmare. Demand trends were upended during the pandemic and that coincided with seismic shifts in the supply chain. The net effect is that inventories have been on a roller coaster ride, and the latest indication is that many consumer-facing businesses are swimming in inventory. The aim of this report is to see which companies are

Summary Points: Consumer companies are sending a lot of mixed signals. Companies that’ve reported shortfalls have been quick to blame macroeconomic factors, but we are skeptical of those claims. We think the bigger story is a return to normalcy, and some companies didn’t see it coming. The consumer is undoubtedly facing some stiff headwinds, but we’ve been more optimistic than most about their spending potential. Companies with pricing power are likely to fare best in

Summary Points We launched a model portfolio called the Consumer Beacon two months ago and from time to time, we intend to publish reports featuring stocks in the portfolio. This one focuses on Amazon. We aim to offer a differentiated view of the company’s fundamentals and valuation. e-Commerce penetration is taking a pause after a period of breakneck growth. It could take another year or so for the channel to grow into its natural penetration

Summary Points Consumer sentiment has been falling like a rock. The June reading was the lowest on record. It’s hard to imagine that consumers are feeling worse today than they did during the 1973 oil crisis, the Vietnam draft, the wake of 9-11 and during the depths of the Financial Crisis. In this report we study what drives consumer sentiment. We also assess whether it matters to future consumption trends. We built a model that

Summary Points Surging energy prices are taxing consumers $25 billion on a monthly basis, equivalent to 2% of total PCE. Lately, prices have come off their peak and where they’ll head is anyone’s guess. Our goal with this report is to establish a framework for investing in consumer-related stocks during periods of energy price volatility, regardless of whether prices are moving up or down. We’re tracking daily spending trends in states with high gas prices,

Summary Points Rubinson Research hosted a webinar on June 30th. The aim was to stress-test the consumer by: quantifying many of the headwinds and tailwinds facing the consumer, creating scenarios to frame an outlook for H2 2022, assessing how the spending power of low-end consumers might flex with various assumptions, analyzing the wealth effect and testing how sensitive PCE might be to changes in financial assets and home prices, exploring shifts in household spending, including

Summary: Consumer demand is shifting. Categories that under-achieved during the pandemic are growing +15 percentage points faster than those that over-achieved. At the same time, spending on food and energy is claiming an incremental 0.7% of aggregate PCE. This has created an opportunity for some and an air pocket for others. Supply dynamics are further complicating the matter, and in this report we dig into inventory and capital spending to assess the supply side of

Summary Points We estimate that household wealth is down by ~$8 trillion since the year began and investors are wondering whether that will put pressure on consumption trends. After all, the consumer is already feeling a pinch from surging gas prices, broad-based inflation, rising mortgage rates and tough comparisons. In this report we assess whether the consumer can tolerate a drop in wealth or if it’ll put them over the edge. We measure the wealth

Summary Labor markets are among the tightest on record with nearly two jobs available for every unemployed person. Part of the tightness is attributable to strong demand and part can be ascribed to scant supply. Real demand for goods and services is 5% higher than it was in 2019 even though there are (2)% fewer people to get the jobs done. Our view is that nominal PCE can grow strongly in 2022, but that surging