Our food analysis, shown below, is based on sales from the following companies: Albertsons (ACI- data since 2020), Kroger’s (KR), Starbucks (SBUX), McDonald’s (MCD), Coke (KO), Pepsi (PEP), Chipotle (CMG), YUM Brands (YUM), Sysco (SYY), and ADM (ADM). We took the same approach and compared each company’s current annual revenue growth to 2021-2022 and the three years before the pandemic. We also weighted their revenue growth and calculated a weighted aggregate sales growth. Remember that the graphs and the results from the first Commentary do not account for inflation.
The first graph shows that five of the nine food companies have higher sales growth today than in the pre-pandemic period (we exclude ACI as there is no data for the period). However, all ten companies except McDonald’s have lower sales growth than in 2021-2022. The graph on the right shows that the weighted annual sales growth is now the lowest since 2017. This analysis confirms our prior work that personal consumption growth has slowed considerably. Now, considering inflation is about 2% higher than in the pre-pandemic period, our thesis strengthens.
Lance Roberts
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