US Consumer Staples "The Question Bank: Key Questions Looking Ahead" Grom

Research evidence excerpt

US Consumer Staples "The Question Bank: Key Questions Looking Ahead" Grom

many Staples investors are looking to understand in more detail across the tristan.how@ubs.com

broader sector. These include: +1-212-713 1081

Any Notable Shifts In Category Demand: As noted above, we think the biggest

question facing the group centers on category growth. In certain pockets of the

group we have seen trends show some modest improvement at points throughout

the year (i.e., salty snacks, beer, household products, etc.), but there seems to be

concern as to whether this can continue, particularly as consumers contend with

higher energy prices in the US and other markets around the world. We think

investors will be keen to understand recent trends and whether sustained

improvement is realistic looking ahead.

Updated Views On Cost Outlook: While much of our coverage has limited

direct exposure to the Middle East, we think investors have become increasingly

concerned around the impacts these events are having on (1) consumer

confidence more broadly, (2) input cost inflation, and (3) FX. Many of these

companies have flagged these cost pressures as manageable at this stage, but we

think investors will be looking to understand whether the magnitude of pressures

has increased and/or whether these pressures could linger into '27.

GLP-1 and Broader Shifts In Category Growth: Although GLP-1 has been a

topic of discussion across the group for some time, it has come up more frequently

in our discussion in recent weeks with investors growing increasingly concerned

around how an uptick in adoption will impact consumption. While our analysis

would suggest only a modest headwind thus far (link) we think investors will be

looking to get an update on the path forward - both in terms of growth headwinds