U.S. Households Shift Shopping Trends Amid Budget Constraints
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 day ago
0mins
Source: Benzinga
- Shopping Channel Restructuring: According to dunnhumby's Consumer Trends Tracker, more U.S. households are reorganizing their shopping habits due to tightening budgets, with traditional supermarkets losing their default status, as evidenced by Walmart's customer penetration reaching 72% in December, the first time surpassing 70% since tracking began.
- Increased Economic Pressure: The report indicates that 57.4% of households struggle to cover an unexpected $400 expense, while 27.5% have cut meal sizes or skipped meals for financial reasons, highlighting the growing financial strain that is influencing consumer behavior.
- Rising Dependence on Discounts: Consumers are increasingly relying on deals and coupons, with 47% of shoppers reporting frequent use of loyalty coupons in December, a 2.5% increase from August, reflecting a heightened sensitivity to pricing.
- Spending Disparities Between Income Levels: Although U.S. holiday spending reached a historic $1 trillion in December, this surge was primarily driven by inflation and tariff-induced price increases rather than higher sales volumes, with lower-income shoppers exercising caution and increasingly relying on credit cards and Buy Now, Pay Later options to manage their budgets.
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Analyst Views on DG
Wall Street analysts forecast DG stock price to fall
16 Analyst Rating
9 Buy
7 Hold
0 Sell
Moderate Buy
Current: 152.020
Low
125.00
Averages
147.00
High
170.00
Current: 152.020
Low
125.00
Averages
147.00
High
170.00
About DG
Dollar General Corporation is a discount retailer. The Company offers merchandise, including consumable items, seasonal items, home products and apparel. Its merchandise includes brands from manufacturers, as well as its own private brand selections with prices at discounts to brands. Its consumables category includes paper and cleaning products, packaged food, perishables, snacks, health and beauty, pet, and tobacco products. Its seasonal products include holiday items, toys, batteries, small electronics, greeting cards, stationery, prepaid phones and accessories, gardening supplies, hardware, automotive and home office supplies. Its home products include kitchen supplies, cookware, small appliances, light bulbs, storage containers, frames, candles, craft supplies and kitchen, bed and bath soft goods. The Company’s apparel products include basic items for infants, toddlers, girls, boys, women and men, as well as socks, underwear, disposable diapers, shoes and accessories.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Uneven Inflation Impact: According to Morgan Stanley, lower-income consumers faced significantly higher inflation rates for food and housing in 2024 compared to wealthier counterparts, exacerbating the gap between economic growth and consumer confidence and highlighting social inequality.
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- Shopping Channel Restructuring: According to dunnhumby's Consumer Trends Tracker, more U.S. households are reorganizing their shopping habits due to tightening budgets, with traditional supermarkets losing their default status, as evidenced by Walmart's customer penetration reaching 72% in December, the first time surpassing 70% since tracking began.
- Increased Economic Pressure: The report indicates that 57.4% of households struggle to cover an unexpected $400 expense, while 27.5% have cut meal sizes or skipped meals for financial reasons, highlighting the growing financial strain that is influencing consumer behavior.
- Rising Dependence on Discounts: Consumers are increasingly relying on deals and coupons, with 47% of shoppers reporting frequent use of loyalty coupons in December, a 2.5% increase from August, reflecting a heightened sensitivity to pricing.
- Spending Disparities Between Income Levels: Although U.S. holiday spending reached a historic $1 trillion in December, this surge was primarily driven by inflation and tariff-induced price increases rather than higher sales volumes, with lower-income shoppers exercising caution and increasingly relying on credit cards and Buy Now, Pay Later options to manage their budgets.
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- Portfolio Adjustments: The fund completely exited its position in PagSeguro Digital in Q4, indicating a strategic portfolio adjustment likely based on market performance and future expectations.
- Top Holdings: As of December 31, Restaurant Brands International remains Baupost's largest holding, indicating sustained confidence in the restaurant sector, and it was also the top holding in Q3, showcasing stability.
- Market Performance Comparison: Amazon was the worst-performing stock among the Magnificent Seven in 2025, and Baupost's investment decision may be based on optimism regarding its cloud segment growth, which will test the effectiveness of Klarman's strategy against Buffett's reduction in exposure.
See More
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- Disconnect Between Data and Sentiment: Despite rising economic output and stock market gains, ordinary Americans are feeling increased financial pressure, as evidenced by credit card debt reaching a record $1.28 trillion in Q4 last year, indicating that economic prosperity is not benefiting the majority.
- Uneven Inflation Impact: According to Morgan Stanley, lower-income consumers faced significantly higher inflation rates for food and housing in 2024 compared to wealthier counterparts, exacerbating the gap between economic growth and consumer confidence and highlighting social inequality.
- 'Hiring Recession' in Job Market: While economic output per hour hit new highs, ordinary workers are anxious as the job market tightens, with December job openings falling to their lowest level since 2020, reflecting the disparity in economic benefits between high-income stockholders and the general workforce.
- Crisis of Trust in Economic Data: Surveys reveal that nearly 60% of Americans believe the economy is in recession, particularly among low-income households facing unstable financial situations, leading to a decline in trust in government economic data and highlighting the significant gap between economic prosperity and public sentiment.
See More
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- Shopping Channel Restructuring: According to dunnhumby's Consumer Trends Tracker, more U.S. households are reorganizing their shopping habits due to tightening budgets, with traditional supermarkets losing their default status, as evidenced by Walmart's customer penetration reaching 72% in December, the first time surpassing 70% since tracking began.
- Increased Economic Pressure: The report indicates that 57.4% of households struggle to cover an unexpected $400 expense, while 27.5% have cut meal sizes or skipped meals for financial reasons, highlighting the growing financial strain that is influencing consumer behavior.
- Rising Dependence on Discounts: Consumers are increasingly relying on deals and coupons, with 47% of shoppers reporting frequent use of loyalty coupons in December, a 2.5% increase from August, reflecting a heightened sensitivity to pricing.
- Spending Disparities Between Income Levels: Although U.S. holiday spending reached a historic $1 trillion in December, this surge was primarily driven by inflation and tariff-induced price increases rather than higher sales volumes, with lower-income shoppers exercising caution and increasingly relying on credit cards and Buy Now, Pay Later options to manage their budgets.
See More
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- Leadership Changes: Walmart and Target welcomed new CEOs on February 1, with John Furner and Michael Fiddelke being promoted from within, reflecting differing strategic directions as both companies navigate economic challenges.
- Performance Discrepancy: Walmart's stock has surged approximately 163% over the past five years, while Target's has plummeted about 40%, indicating Walmart's success in attracting consumers across income levels and boosting online sales, whereas Target struggles with declining sales and store traffic.
- Future Outlook: Walmart anticipates a full-year net sales increase of 4.8% to 5.1%, contrasting with Target's expected sales decline, highlighting significant differences in market performance and investor sentiment favoring Walmart's prospects.
- Strategic Adjustments: Target's new CEO Fiddelke aims to revitalize the brand by enhancing product quality and customer experience while strengthening the workforce, demonstrating a commitment to future growth despite facing numerous challenges.
See More
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- Tech Stock Pressure: Selling pressure in the Nasdaq is expected to exceed that of the S&P 500 due to ongoing fears of AI disruption, indicating a cautious market sentiment that may impact the short-term performance of tech companies.
- Norwegian Cruise Investment: Activist investor Elliott Investment Management has acquired over a 10% stake in Norwegian Cruise Line, aiming to turnaround the underperforming operator, which has led to a more than 6% increase in share price, reflecting market confidence in its restructuring potential.
- Energy Stock Upgrade: Melius upgraded Chevron from hold to buy, raising its price target from $162 to $205, as analysts believe the global energy company is well-positioned for growth, particularly due to developments in Venezuela.
- Apple Product Launch: Apple has invited press members to a
See More
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- Complete Exit: Kiltearn Partners LLP sold 335,500 shares of Sealed Air in Q4, fully exiting its position, which previously accounted for 2.4% of its AUM, indicating a cautious outlook on the company's future prospects.
- Concentrated Investment Strategy: Kiltearn now holds only 28 positions valued at $461.7 million, with its top five holdings representing over 44% of AUM, reflecting a highly concentrated portfolio that may increase investment risk.
- Performance Analysis: Sealed Air's stock performed well over the past year, returning 26.3%, nearly double the S&P 500's 13.2%, despite a 1% drop in Q3 sales after excluding foreign currency effects.
- Future Outlook: Management expects sales to decline by 2% to 3% for the year and will report Q4 results on March 2, prompting investors to watch for signs of a turnaround in sales trends.
See More
