Some major companies are facing challenges that are impacting their stock prices. Despite strong consumer spending, there are signs of changing consumer behavior. For example, more people are opting for cheaper generic products over name brands. This shift is evident in lower-income households outspending wealthier individuals. If consumer spending slows down, it could have negative effects on the economy and the stock market.
Here are three consumer staples companies that are struggling and may be worth selling before their stocks decline further:
1. Unilever (UL): The British consumer goods giant has seen its stock price drop by 14% over the last five years. To address this, Unilever is planning to spin off its ice cream division, which includes popular brands like Ben & Jerry’s and Magnum. The company hopes that this restructuring, along with cost-saving measures, will improve its performance.
2. Walgreens Boots Alliance (WBA): The retail pharmacy chain has experienced a 33% decline in its stock price year-to-date and a 66% decrease over the past five years. Despite efforts to cut costs, including a significant dividend reduction, Walgreens continues to face challenges such as weak demand for Covid-19 medications and low pharmacy reimbursement rates.
3. Procter & Gamble (PG): The consumer goods company behind brands like Tide and Gillette is struggling as consumers opt for cheaper generic alternatives due to price increases. While Procter & Gamble reported mixed financial results in the first quarter, with sales falling short of expectations, the company remains optimistic about its future performance.
Overall, these companies are grappling with various issues that are affecting their financial outlook. Investors may want to consider selling their shares in these companies to avoid potential losses in the future.