U.S. Broadlines, Hardlines & Food Retail: Looking for Life in the Retail Desert

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U.S. Broadlines, Hardlines & Food Retail: Looking for Life in the Retail Desert

Equity Research

U.S. Broadlines, Hardlines & Food Retail

8 June 2026

Looking for Life in the Retail

Desert

Sentiment seems quite negative across our group right now. U.S. Broadlines, Hardlines & Food Retail

Much of it is hard to fight. We see select opportunities based NEUTRAL

on seasonal drivers, comparisons (home improvement, SFM, U.S. Broadlines, Hardlines & Food

Retail

DLTR), inflation (WMT, select grocery), and some longer term Seth Sigman

disconnects (AZO/ auto parts). +1 212 526 7417

seth.sigman@barclays.com

BCI, US

Oliver Hu

+1 212 526 6180

oliver.hu@barclays.com

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Still stuck? The title of our outlook in January was "ride the waves but still far from shore",

anticipating a bump for our stocks from stimulus, among other opportunities throughout the

year, but still lacking a catalyst for a bigger cyclical inflection. Q1 results mostly came in better

with some help from tax refunds, but that tide has gone out, at least from a sentiment

perspective. We see some opportunities as we detail in this note, but absent a real resolution in

the Middle East, this group feels stuck.

From a macro perspective, it's difficult to see how the consumer improves; the low end

continues to be pressured by snap cuts, inflation incl. gas (see our note published today), and

wage growth; the middle seems stable but with no reason for improvement; the high end

continues to drive the growth. Meanwhile, cyclical factors such as interest rates are not