More and more, stores are putting money into lowering the prices of everyday things. Walmart Inc. is leading the way in this trend, which will likely help it gain more market share.
The company D.A. Davidson said this and released a new price-tracking database on Friday. The database had been in the works for 18 months.
“We are releasing this work now for two reasons: after 18 months, we have enough data; and the trend in grocery prices has become a hot-button issue after some prices went up,” analysts Michael Baker and Keegan Cox wrote in a commentary about the tracker.
Kamala Harris’s campaign said this week that she will call for what they call the first-ever government ban on food and grocery store price gouging by businesses. Harris is going to talk about the move in a speech in North Carolina on Friday.
The D.A. Davidson analysts have been keeping an eye on online prices for a wide range of goods from February 2023. These prices come from stores that sell groceries, car parts, home goods, and other hard-to-reach places. Every week, on average, they keep track of 70 SKUs (stock keeping units) at 16 stores.
Since then, the prices of 38% of the items being tracked have gone up, 29% have gone down, and 33% have stayed the same.
But since February 2024, prices have only gone up or down for 26% of goods and 30% have gone down. The number of rises has dropped to 22% in the last three months.
Analysts wrote that the figures are in line with overall trends in the consumer price index and food at home in particular.
The biggest price changes were for eggs. This is a trend that has been seen in both the CPI and the results of Cal-Maine Foods Inc. CALM 0.34%, the biggest egg producer in the country. The company said that an avian flu outbreak in Kansas and Texas hurt its most recent quarter.
They said that things like cat litter, dog food, and paper towels have been more steady.
They wrote, “Among retailers, Walmart Inc. WMT 0.65% has tended to be the price leader on like-for-like products, as well as the warehouse clubs where the same products are available.”
AutoZone Inc. (AZO 1.39%) and O’Reilly Automotive Inc. (ORLY 0.33%) have seen prices stay the same or go up, while Advance Auto Parts Inc. (AAP -0.32%) has been running more sales.
Prices at home centers are lower than they were 18 months ago, but most of the drops happened in the first few months of 2023, and prices have stayed the same since then. List prices have stayed the same at Ulta Beauty Inc. ULTA 3.12% in other core categories, but Dick’s Sporting Goods Inc. DKS 0.23% has raised prices, which could be helping the company gain market share, the note said.
The experts came to the conclusion that Walmart will probably keep getting more market share because people are looking for the best deals. The big store chain reported better-than-expected quarterly earnings on Thursday and said it’s still growing its business with wealthy customers. Its stock hit a new all-time high during the day because of the news.
Grocery Outlet Holding Corp. GO 0.11% needs to put money into pricing, though, because its prices aren’t as low as experts thought they would be compared to others.
Advance Auto’s price increase could hurt profit in the car parts market. The experts like O’Reilly better.
They wrote that even though same-store sales have been down for more than two years at Home Depot Inc. HD 0.55% and Lowe’s Cos. LOW 0.45%, prices have been “rational.”
It helped them decide to “buy” Home Depot, they wrote.
