News about consumer goods

During the week of October 12–16, the Consumer Staples Select Sector SPDR Fund (XLP) rose 5%, its best week since February, while the SPDR S&P 500 ETF (SPY) fell 1.97% and the Invesco QQQ Trust (QQQ) dropped 5.5%. Cracker Barrel (CBRL) gained 20% on the week, extending a 171% year-to-date surge after a leadership change and the reversal of an unpopular rebrand; its fiscal Q4 adjusted EPS of $0.99 beat the $0.18 estimate. Signet Jewelers (SIG) rose 12.6% on reports it is in advanced talks to join a consortium buying De Beers, and VF Corp. (VFC) gained 12% after Truist upgraded it to Buy. On the downside, Kandi Technologies (KNDI) plunged 38% to a near six-year low as it announced a 1-for-10 reverse stock split, Six Flags (FUN) fell 29% to a six-year low after a visitor's death at its Georgia park, and Newsmax (NMAX) lost over 15%.

Citing Bloomberg's Mark Gurman, the article says Apple is planning a higher-end HomeView with a roughly 9-inch screen on a motorized arm that turns 360 degrees, targeted for 2027 or 2028, with no price yet. The robot, code-named J595, has slipped about a year from its earliest planned date. Meanwhile, revenue in the Wearables, Home and Accessories segment fell 13.5% from a peak of $41.24 billion in fiscal 2022 to $35.69 billion in fiscal 2025, while R&D spending nearly doubled to $42.90 billion over the last 12 months. The article calculates that at a price near $1,000, each million units would add about 2.8% to segment revenue.

The article compares dividend stocks Coca-Cola (KO) and Nike (NKE), which yield 2.3% and 4.4%, respectively. Coca-Cola has raised its dividend for 64 consecutive years and grew it 51% in the past decade, while Nike has increased its payout for 24 straight years and by 128% over the last 10 years. Nike's stock trades 79% below its November 2021 peak as it undergoes a turnaround, with management expecting sales to decline this fiscal year. The author leans toward Coca-Cola for its stability, citing a 34.9% operating margin in the second quarter.

The article profiles five consumer stocks trading near 52-week lows that the author would hold for the next five years, mainly for their dividends. PepsiCo (yield about 4.6%, raised for 54 straight years) is under pressure from Elliott Management's $4 billion stake, which pushed it toward cutting about 20% of its U.S. product lineup and lowering prices on core brands. Hershey (yield about 3.6%) is using lower cocoa prices to restore original recipes, while General Mills (yield above 7.5%, uninterrupted dividends since 1898) faces soft volume as shoppers trade down to store brands. Clorox (yield close to 6%) paid $452 million in dividends over nine months but generated only $161 million in free cash flow, partly due to a one-time $476 million buyout of P&G's Glad stake. Kraft Heinz (yield over 7%) is the riskiest pick because of high debt and past dividend cuts, so the author would treat it as the smallest position.

FMCG companies face sustained margin pressure in the second half of the fiscal year as input costs rise, and firms are weighing post-Diwali price hikes against the risk of hurting demand in mass-market and rural categories. Grant Thornton Bharat's Naveen Malpani said palm oil prices in rupee terms were about 21% higher year over year in September, and sugar about 18% higher despite an 8% monthly correction. Pre-results analyst estimates projected operating-margin compression of about 45 basis points across major consumer staples companies, with some estimates up to 150 basis points. Parle Products' Mayank Shah said companies were absorbing costs through efficiencies, fewer discounts and lower advertising, with price increases possibly coming after the festive season. Nestle India expects sugar and edible oils to stay elevated in the December quarter, while El Niño and an uneven monsoon add uncertainty for food prices and rural demand.

Samsung is reportedly preparing to exit its home appliances business in China, the latest step in a multi-year retreat that began with closing its smartphone production in 2019, followed by TVs and PCs. The article attributes this to domestic Chinese brands such as Haier, TCL, Hisense and Xiaomi offering products that are cheaper and higher quality, backed by vertically integrated supply chains and fast product cycles. It argues that European and Korean brands will have to accept thinner margins or retreat to the premium segment. The article also predicts the mass market will be dominated by low-cost Chinese devices, which would benefit consumers worldwide.

Dutch Bros (BROS) trades 52% below its record high, even though the coffee chain has grown quickly through small-format and drive-through locations. Bulls point to store growth: the company had 1,225 locations as of June 30, up 17% from a year earlier, and management sees room for 7,000 stores, almost six times its current footprint. Same-store sales have grown for 13 straight quarters, and analysts project revenue will rise 97% from 2025 to 2028. Bears point to a crowded market with low barriers to entry and no switching costs for customers, which makes a durable moat hard to prove. Dutch Bros also faces scale competition from Starbucks, McDonald's and Dunkin' in real estate, marketing and sourcing, plus smaller rivals such as 7 Brew and Biggby Coffee.

Apple's iPhone Duo, its first foldable phone and most expensive iPhone, opened for preorder on Friday, with launch-day pickup inventory selling out quickly and some online delivery estimates slipping into late January. Apple called demand 'nothing short of extraordinary' and said it will keep taking online orders. The Duo starts at $1,999 and passes $3,000 at the 2TB tier, and supply is expected to be tight; IDC expects Apple to ship about 7 million units this year, roughly 3% of its total, and sees shipments growing 70% next year, which could give Apple about 40% of the foldable market. Analysts say the high price could lift revenue, but it could also stretch out upgrade cycles. Apple's latest quarter brought in $109.4 billion in revenue, up 16%, but it guided September-quarter revenue growth to 9% to 11%, citing supply limits and memory costs.

USA Financial Formulas bought a new position of 2,037 Costco Wholesale shares in the third quarter, according to its 13F filing with the SEC, worth about $1,854,000. The stake makes up roughly 0.4% of the fund's portfolio and is its 19th-largest holding. The article also reports two insider sales: EVP William Richard Wilcox sold 1,100 shares at an average $958.21 on October 13th, a 26.23% reduction in his position, while EVP Claudine Adamo sold 2,200 shares at $915.93 on September 29th, a 23.57% cut. Costco reported September net sales of $30.02 billion, up 13% year over year, with digitally enabled sales up 19%. Per MarketBeat, 24 analysts rate the stock Buy, eight Hold and one Sell, with a consensus price target of $1,087.40, and Costco declared a quarterly dividend of $1.47 per share.