Consumer Industry Trends

Wednesday, April 16, 2014

The restaurant industry's year-to-date gain through February was just over 1%, slightly outpacing the S&P 500. "Virtually every subsector of the restaurant space is outperforming the market this year, led by quick-service, on double-digit gains at Jack in the Box, Burger King, and Popeyes," according to analyst Sharon Zackfia in the March Monthly Morsels.

In the Monthly Review of E-commerce Migration, analyst Mark Miller states that investors should focus on the risk of retailers' share loss to e-commerce competitors. Since our 2011 publication of More Retailers Struggling to Navigate Amazon's Surging Current, "retailers with a below-average e-commerce risk profile have outperformed the S&P 500 by 19%. Conversely, retailers that carry above-average risk underperformed the market by 17%."

For the consumer products industry, analyst Jon Andersen believes, "There are at least three important reasons to invest in the consumer staples sector: stable growth, attractive returns, and solid and countercyclical relative share price performance." These factors are discussed in the March edition of the Consumer Products Monthly.

According to analysts Amy Noblin, Sharon Zackfia, and Daniel Hofkin, while the apparel and accessories stocks have rebounded from a difficult January, the persistent winter weather has cooled early spring selling. Relating back to e-commerce migration, the analysts state that there is a dominant trend of retailers moving online. "As a percent of the total, e-commerce share of total retail rose to 11.4% this month, from 10.7% in January last year, and in apparel and accessories e-commerce share rose to 15.5%, from 14.0% last year." Further information is available in the March What's in Store for Apparel and Accessories.

William Blair publishes four monthly consumer periodicals: Monthly Review of E-commerce Migration, Monthly Morsels, Consumer Products Monthly, and What's in Store for Apparel and Accessories. These publications provide an update on the trends and perspectives of their respective industries.

For more information or copies of these monthly reports or monthly publications from our other sectors, please contact your William Blair representative.

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