PEZ - The Costco Economy

2024-06-14 11:00:00 ET

Summary

• Both Costco and Ross Stores are experiencing increased foot traffic and higher sales of previously less popular products, indicating a strong and resilient U.S. consumer.
• The shift in consumer behavior toward buying more discretionary items is attributed to the deceleration of inflation, according to Costco management.
• Constellation Brands, including its Modelo beer brand, is also not seeing any issues with the U.S. consumer and is investing in capacity to meet the demand.

By Samuel Rines

Earnings season never really ends. It is a slow, steady drip of useful - sometimes conflicting - data. But listening closely can be powerful for uncovering both positive and negative trends. For example, American Airlines signaling a weaker-than-expected summer should be taken with a grain of Boeing. Norwegian Cruise Lines is not seeing a problem with its travelers. Not every headline should be taken as a sign. It takes a bit of digging....

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