While inflation has been showing some signs of cooling recently, macroeconomic headwinds are expected to keep food prices elevated. Moreover, grocery store stocks tend to be good hedges amid market downturns due to inelastic demand for their goods. Hence, fundamentally strong grocery store stocks Walmart (WMT), Casey’s General (CASY), and Sprouts Farmers Market (SFM) might be ideal buys now as recession concerns rise. Keep reading.
While the November consumer price index rose less than expected, showing signs of inflation cooling, food prices rose 0.5% and were up 10.6% from a year ago. Moreover, the Russia-Ukraine war, sharp rising costs of energy and transportation, blocks in trade flows, poor crop conditions, and avian flu outbreaks are expected to push food prices even higher.
Moreover, online retail shopping has grown significantly over the past few years. Last year, online sales grew 10.6% year-over-year, and e-commerce sales bagged 21.6% of total retail sales, up from 20.9% in 2021. Moreover, the development of several online grocery store apps is expected to add momentum to the growth of the online grocery market share.
Furthermore, given the inelastic demand for groceries, the industry is expected to perform steadily even if the economy suffers a recession, as grocery stores can easily pass on rising costs to consumers.
Therefore, fundamentally strong grocery store stocks Walmart Inc. (WMT), Casey’s General Stores, Inc. (CASY), and Sprouts Farmers Market, Inc. (SFM) might be ideal buys now as a recession looks imminent this year.
Walmart Inc. (WMT)
WMT engages in the operation of retail, wholesale, and other units worldwide. The company operates through three segments: Walmart U.S.; Walmart International; and Sam’s Club. It operates supercenters, supermarkets, hypermarkets, warehouse clubs, cash and carry stores, and discount stores; membership-only warehouse clubs; e-commerce websites.
On January 5, WMT announced that it had successfully operated 36 drone delivery hubs across seven states, including Arizona, Arkansas, Florida, North Carolina, Texas, Utah, and Virginia. Over the past year, Walmart has safely completed more than 6,000 deliveries to customers in as little as 30 minutes.
WMT is uniquely positioned to offer drone delivery at scale, with its 4,700 stores located within 90% of the U.S. population, which might benefit the company.
WMT has paid dividends for 49 consecutive years. Its current dividend of $2.24 yields 1.55% annually.
WMT’s total revenue increased 8.7% year-over-year to $152.81 billion in the third quarter that ended October 31, 2022. Its net sales came in at $151.47 billion, up 8.8% year-over-year. Its adjusted EPS rose 3.4% year-over-year to $1.50.
The consensus EPS estimate of $1.40 for the fiscal year 2024 first quarter ending April 2023, represents a 7.4% improvement year-over-year. The consensus revenue estimate of $145.32 billion for the same quarter represents a 3.6% increase from the same quarter last year.
The company has an impressive earnings surprise history, as it surpassed the consensus revenue estimates in each of the trailing four quarters.
The stock has gained 16.5% over the past six months to close the last trading session at $144.86.
WMT’s POWR Ratings reflect this promising outlook. The company has an overall rating of A, which translates to Strong Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
WMT is also rated an A in Sentiment and B in Stability. Among the 39 stocks in the A-rated Grocery/Big Box Retailers industry, it is ranked #10.
To see additional POWR Ratings for Growth, Value, Momentum, and Quality for WMT, click here.
Casey’s General Stores, Inc. (CASY)
CASY operates convenience stores under the Casey’s and Casey’s General Store names. Its stores offer a selection of food, beverages, tobacco and nicotine products, health and beauty aids, automotive products, and other non-food items.
On December 6, CASY declared a quarterly dividend of $0.38 per share, payable on February 15, 2023. Its annual dividend of $1.52 yields 0.69% on prevailing prices. The company has raised its dividend at a CAGR of 6.2% over the past three years.
CASY’s total revenue rose 21.9% year-over-year to $3.98 billion in the fiscal second quarter that ended October 31, 2022. Its net income increased 42% year-over-year to $137.56 million, and its earnings per share rose 41.7% from the year-ago value to $3.67.
The company is expected to witness revenue growth of 15.6% year-over-year to $3.52 billion for the fiscal third quarter ending January 2023. Its EPS is estimated to increase 9.7% year-over-year to $1.88 in the same quarter. The company has surpassed the consensus EPS estimates in each of the trailing four quarters.
Over the past six months, CASY has gained 13.4%, closing the last trading session at $219.18.
CASY’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of A, which equates to a Strong Buy in our proprietary rating system.
The stock has a B grade for Sentiment, Quality, and Value. It is ranked #6 in the same industry.
Click here to see the additional POWR Ratings for CASY (Growth, Momentum, and Stability).
Sprouts Farmers Market, Inc. (SFM)
SFM offers fresh, natural, and organic food products in the United States. The company offers perishable product categories, including fresh produce, meat, seafood, deli, bakery, floral and dairy, and dairy alternatives; and non-perishable product categories, such as grocery, vitamins and supplements, bulk items, frozen foods, beer and wine, and natural health and body care.
On November 2, SFM announced its partnership with DoorDash Inc. (DASH) in select cities, beginning with Phoenix, Arizona, for on-demand grocery delivery. Customers can order thousands of fresh, natural, organic products from SFM by visiting the DoorDash mobile app or website. This is expected to have a positive impact on SFM’s topline.
During the third quarter ended October 2, 2022, SFM’s net sales increased 5.4% year-over-year to $1.59 billion. Its net income increased 2.9% year-over-year to $65.74 million, while its EPS for the quarter increased 8.9% year-over-year to $0.61. The company’s adjusted EBITDA rose 3.8% year-over-year to $121.54 million.
Analysts expect SFM’s revenue for the fourth quarter ending December 2022 to be $1.56 billion, representing 4.6% year-over-year growth. The company’s EPS is likely to increase by 14.6% to $0.37 for the same quarter. The company has an impressive earnings surprise history, as it surpassed the consensus EPS estimates in each of the trailing four quarters.
SFM has gained 19.2% over the past six months to close its last trading at $32.09. It gained 2.3% intraday.
It is no surprise that SFM has a B grade which translates to Buy in our proprietary rating system. It is graded A for Quality and is ranked #17 in the Grocery/Big Box Retailers industry.
Beyond what we’ve stated above, we have also given SFM grades for Momentum, Value, Stability, Growth, and Sentiment. Get all SFM ratings here.
WMT shares were trading at $145.06 per share on Wednesday morning, up $0.20 (+0.14%). Year-to-date, WMT has gained 2.31%, versus a 2.70% rise in the benchmark S&P 500 index during the same period.
About the Author: Kritika Sarmah
Her interest in risky instruments and passion for writing made Kritika an analyst and financial journalist. She earned her bachelor’s degree in commerce and is currently pursuing the CFA program. With her fundamental approach, she aims to help investors identify untapped investment opportunities.
5 Ways to Become a Better Public Speaker This Year
Opinions expressed by Entrepreneur contributors are their own.
The ability to speak publicly is a skill that everyone can use. From coaches to entrepreneurs and writers, anyone who wants to get out into the world to market what they do needs to be an effective speaker.
This article will discuss five ways to become a better public speaker — five methods for sharpening your raw talents to morph into a more effective communicator overall.
Related: This Is the One Thing You Need If You Want to Get Paid Speaking Gigs
1. Practice in different environments
This tip comes from an exercise that musicians sometimes use while practicing.
The idea is to see if you can replicate your performance no matter where you are. As a speaker, you will encounter all kinds of scenarios and audiences. You have surely had distractions around you, being in front of people with different interests, being under different lighting and noise conditions and more.
Practicing speaking in different environments will force you to get comfortable performing under all circumstances. Without the crutch of your favorite environment, you have to remember your lines and recall cues completely on your own.
Related: 4 Expert-Backed Strategies for Improving Your Communication Skills
2. Produce different kinds of ‘speaking’ content
Another tip for becoming a more well-rounded speaker is to produce a variety of speaking content. Speakers don’t always have to stand on a stage and talk to live audiences.
I create speaking content across many channels — from my website and blog to YouTube and my podcast series. I distribute audio and video recordings of my speeches to my clients and promote them on my social channels. I go live on Facebook and other platforms to speak directly to my audiences that way. You can do the same.
This variety isn’t by accident. Producing these different types of content in the digital space allows individuals to sharpen their speaking skills and reach larger audiences than they could in person.
3. Get active on audio platforms
Here’s a speaking tip that doesn’t involve performing as much as learning from what others are already doing: Get active on professional audio platforms such as Clubhouse and Twitter Spaces to meet with like-minded individuals and discuss relevant topics.
Doing this lets you compare notes with industry counterparts while working on your speaking skills. You will endeavor to communicate with other business leaders and coaches from around the world and all different walks of life.
Related: The Role of Effective Communication in Entrepreneurial Success
4. Take every opportunity to speak
Speak to a group at every available opportunity. I used to wonder how I could speak to an audience when the professional invitations dried up for a bit, and the answer was local service groups.
Toastmasters International, Rotary International, Lions Clubs International and the Freemasons are all great examples of the types of organizations that not only perform good works for their local communities but also welcome speakers and presenters to deliver valuable information to their members.
I find chapters of these groups in many cities and towns that I visit. Having these groups near me allows me to cut down on my travel time and simply makes it more convenient to continue practicing speaking skills while also putting my abilities to good use for my community.
Not only will this help you with your skills at public speaking, but it’s a rewarding experience as well.
5. Work with a speaking coach
Finally, every speaker-in-training could benefit from working with a speaking coach or mentor. These professionals provide their clients with professional tips and feedback on everything from the words they’re using to how they’re delivering them to audiences.
Some speakers wonder why they can’t just rely on their friends and families to provide them with honest feedback, and there are some good reasons for not doing that. Family and friends are kind, but that’s exactly the problem. Speakers need the unrelenting honesty of professional coaches if they truly want to leave their bad habits behind and become stronger.
I hired a professional speaking coach to improve my skills, and I can attest that it pays dividends every single day in my career.
Related: Leading Speaking Coach Shares His Strategies To Get A Flood Of Clients From Webinars And Virtual Presentations
Communication is everything to professionals
Whether it’s in the world of business, non-profits or coaching, speaking effectively is vital to success. Communication means everything to professionals, and those who can’t tell others what they do and what they’re about can’t expect to get their visions too far off the ground.
I followed these five actionable tips for becoming a better speaker, and I came out on the other side as a communicator that I never even thought possible. You will do the same.
26% of U.S. Workers Would Rather Undergo a Root Canal Than Follow This Workplace Policy
Opinions expressed by Entrepreneur contributors are their own.
According to a recent survey conducted by job site Monster, more than one in four (26%) U.S. workers would rather undergo a root canal procedure than work in their offices five days a week. Additionally, nearly two in five (38%) workers said they would quit a job that required just one day onsite. These staggering statistics reveal a clear shift in workers’ attitudes towards the traditional office environment, and companies that fail to adapt to this change risk losing their most valuable asset: their employees.
As a highly experienced expert in the field of hybrid work, I talk with 5 to 10 leaders every week about how to make hybrid work serve their needs well. I ask them what their top concern is, and most say it’s hiring and retaining talented staff.
External surveys say the same thing, such as this recent survey by Vistage of the leaders of small and medium-sized businesses. It found that 60% of SME CEOs are planning to increase headcount in the year ahead, with only 7% planning on reducing headcount. According to Vistage Chief Research Officer Joe Galvin, this is a significant shift from the trend of big companies making headlines with layoffs, as small and medium business CEOs are reluctant to lay off their hard-won new employees. One key reason for this shift is the recognition that hiring challenges are impacting the ability of these businesses to operate at full capacity. With 61% of CEOs saying that hiring challenges are a major concern for their ability to operate effectively at full capacity.
Given this information, I confidently tell the leaders whom I advise that the future of work is in a flexible hybrid work model that allows for some full-time remote work. This model not only keeps workers happy and engaged, but it also has a positive impact on a company’s bottom line.
Related: You Should Let Your Team Decide Their Approach to Hybrid Work. A Behavioral Economist Explains Why and How You Should Do It.
Increased productivity and employee engagement
One of the most significant benefits of a flexible hybrid work model is increased productivity and employee engagement. Studies have shown that remote workers tend to work more efficiently and are less likely to experience burnout. A mid-size IT services company that I consulted for implemented a flexible working policy, and they saw a 20% increase in productivity among their remote workers.
Remote workers have the ability to create their own personalized work environment, which leads to an increase in productivity. They can work from a location that is most comfortable for them, whether that be their home, a coffee shop or a coworking space. This leads to a decrease in distractions and an increase in focus, resulting in a higher level of productivity.
Flexible working also has a positive impact on employee engagement. When employees have the ability to work in a way that suits them best, they are more likely to be engaged and motivated. This leads to a decrease in turnover, and an increase in employee loyalty and job satisfaction.
Access to a wider talent pool
A flexible hybrid work model also allows companies to tap into a wider talent pool. When companies are not limited by geographical location, they can attract and retain the best talent from all over the world. A large financial services company that I worked with had difficulty finding qualified candidates in their local area, but by implementing a flexible working policy, they were able to hire top talent from other parts of the country.
A flexible working policy also allows for a more diverse workforce, as it can attract candidates who may have previously been excluded due to geographical constraints. This diversity leads to new perspectives, ideas and innovation.
Cost savings on talent
Flexible working can also lead to significant cost savings for companies. A flexible hybrid work model reduces the need for office space, and it can also lead to a reduction in absenteeism and turnover. A retail company that I consulted for implemented a flexible working policy, and they saw a 30% reduction in absenteeism due to less workers taking sick days and a 20% reduction in turnover.
When employees have the ability to work from home, it leads to a reduction in absenteeism as they are less likely to be affected by things such as traffic, weather, or public transportation issues. This can also lead to a decrease in sick leave, and an increase in overall productivity.
Flexible working can also lead to a reduction in turnover, as employees are more likely to be satisfied and engaged in their work. This leads to a decrease in the cost of recruiting and training new employees.
Addressing cognitive biases
Cognitive biases can play a significant role in decision-making when it comes to flexible working. The status quo bias, for example, leads managers to resist change and stick to the traditional office environment. The sunk cost fallacy can also come into play, where managers may be reluctant to change the way things have always been done because they have invested so much time and resources into the current system. By being aware of these cognitive biases and actively working to overcome them, companies can make more informed and effective decisions about their working policies.
One way to overcome these biases is to gather data and conduct studies on the impact of flexible working on employee productivity, engagement, and turnover. This can provide concrete evidence to support the implementation of a flexible hybrid work model. Additionally, it is important for managers to actively seek out feedback from employees on their preferences for working arrangements and to consider their needs and concerns.
Implementing a flexible hybrid work model
Implementing a flexible hybrid work model can seem daunting, but with proper planning and communication, it can be done successfully. It is important to set clear guidelines and expectations for remote work, such as setting specific hours of availability and ensuring regular communication with team members.
It is also important to provide the necessary tools and resources for remote work, such as a reliable internet connection and a secure virtual communication platform. Providing training on hybrid work best practices and technology can also help to ensure a smooth transition, as can hiring a hybrid work consultant to guide your transition.
Related: Salesforce CEO Marc Benioff Is Right. New Employees Are Less Productive in a Hybrid Work Setting — But Why?
The shift in workers’ attitudes toward the traditional office environment is undeniable. Companies that fail to adapt to this change risk losing their most valuable asset: their employees. A flexible hybrid work model that allows for some full-time remote work is the future for anyone who cares about worker retention, increased productivity, access to a wider talent pool, cost savings, and overcoming cognitive biases. The time for companies to implement this model is now. As a leader of a company, it’s important to recognize that the traditional office model may no longer be the best option for your employees or your business. By embracing a flexible hybrid work model, you can retain top talent, increase productivity and save costs. The future of work is here, and companies that adapt will be well-positioned for success.
Google Worker Laid Off While On Leave Caring For Sick Mom
One person who was laid off from Google in the company’s wave of staff cuts last week says he was on a leave from work taking care of his mother who is terminally ill with cancer.
Paul Baker was on leave for about a month when he received an email letting him know the company was laying him off, along with around 12,000 others, he told Insider.
“While on carer’s leave for my immediate family member’s terminal cancer, I too was laid off. After the initial shock, it morphed into sadness because I miss the people,” he also wrote on LinkedIn.
Related: More Than 1,600 Tech Workers Are Being Laid Off A Day On Average In 2023, According to a New Report
On Jan. 20, Google’s CEO Sundar Pichai sent a note to employees taking responsibility for hiring “for a different economic reality than the one we face today.”
Baker told Insider that he was on leave and was told by a friend about the layoffs, then found his work laptop had been “cut off,” the outlet wrote.
He was a video producer at Google, according to his LinkedIn, and had been at the company since 2018. Baker told Insider he was feeling “shock and sadness.” The outlet said it verified the leave period as well as his severance email and prior employment with Google.
Related: In a Viral TikTok, An Ex-YouTube Employee Talks About Getting Laid Off During a Business Trip
“I’ll truly miss it,” he said.
Baker also told the outlet he has not received information about how his severance package would be affected by the fact that he was on career leave to care for his mom.
Pichai said in the memo the company will provide “six months of healthcare, job placement services and immigration support for those affected.”
Still, he told Insider he would love to go back to the company.
“If there’s ever a Google position open for another video producer position, I would take it in a heartbeat,” he said.
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