- Iconic food and beverage brands continue to grow out of favor with U.S. consumers, according to a new report from Rabobank.
- Many Q1 earnings reports tipped off weakness at well-known F&B brands.
- The bank notes that the increasing purchase power of the millennial generation is a major factor in the shift as e-commerce accounts for a higher mix of purchasing.
- A willingness of major retail chains such as Target (NYSE:TGT), Kroger (KR), and Costco (COST) to attempt to differentiate themselves with new concepts and products has also contributed to well-known brands slipping.
- Rabobank thinks major food and beverage players can still show strong growth rates if they are nimble with their strategy and use M&A wisely to catch fresh brands on the upswing.
- Related stocks: K, GIS, CPB, MDLZ, PEP, KO, HSY, SJM, DPS, KRFT, OTCPK:NSRGY, OTCPK:NSRGF.