Finally! Housing-related retail categories are experiencing some wind in their sales. Two weeks ago, we wrote about mattress and furniture retail reporting on better demand, which we took to be more of a backwards look than a forward look with the reasoning be that it was due to tariff pull forward; however, with Home Depot and **Lowe’s **reporting excellent sales results in July and observed traffic (Advan) in August looking especially robust (+5% YoY MTD), we are going to modify our earlier viewpoint to say that the macro and demand is now improving for housing-related retail.

With Medtronic’s fiscal Q1 quarterly results came the news that two new independent directors had been added to the Board and after Elliott Investment Management became one of its largest shareholders. The WSJ reported , “The activist investor and the medical-device maker have been holding friendly talks around how to boost the company’s valuation and build on ongoing plans to focus on core assets.” Notable from the earnings call, was management’s aim to accelerate top-line growth for the remainder of the fiscal year and beyond, which was one of the “asks” by Elliot per CNBC.

With fiscal Q2 earnings, Target announced that Chief Operating Officer Michael Fiddelke will succeed Brian Cornell as CEO, effective February 1st, 2026. When asked what they were seeing as evidence that the business was improving, Fiddelke said that they were seeing “pockets of green shoots,” but “we need to turn those into a field of green shoots. And that’s where the teams are focused. We need to make sure the experience pays off the expectations that our guests have.

Following the jilted tie-up between 7-Eleven (Seven & I Holdings) and Circle K (Alimentation Couche-Tard), Seven & I updated investors on its growth strategy. (Here we will speak solely of the US business. Additionally, the IPO plans for the US remain.) The strategy includes expanding its private label food offering and quality to raise consumer perceptions in regards to distinctiveness, “taste,” and value, but especially as it relates to fresh and prepared meals.

As previewed , July retail sales accelerated from June’s slower pace due to: first, a strong and early start to back-to-school, second, less disruptive weather, and third, a lessening of consumer uncertainty about inflation, as shown in the chart below. (The New York Fed’s survey also showed that expectations for the rate of inflation 1-year out also dropped for those with a household income above $100K). We suspect that the first was the largest factor, and as such, underlying retail sales should slow (ex.

Advan Auto’s Q2 results were all about whether they can rebuild DIFM market share and drive profitability higher. On the former, market share losses continue as readers will recall from our note on O’Reilly’s results. In an industry* that grew by +2-3% in the period, Advan’s comp-sales increased 0.1%, and comp-transactions were down low-single-digits. DIFM comp-ed up low-single-digits (O’Reilly comp-ed +7% in DIFM). Management shared that the April 19th to May 17th period was similar to the quarter’s ending 4-weeks that July (July 12th), with a soft spot in between.

It’s been quite a challenging period for fast casual restaurant operators and their investors; that’s the result of a smaller “pie” and more mouths at the table. The pie is smaller due to shifts in consumption to gas & convenience and at-home as consumers seek out lower-cost calorie consumption, as well as fewer calories consumed (Wegovy, Ozempic, and Zepbound). More mouths at the table is the result of the high unit growth in the industry (+7% for the larger publicly-traded companies).

Grocery comp-sales are picking up and our hypothesis is that it’s driven by more share-of-stomach coming from restaurants (out-of-home). Inflation is also a contributor; Q2 CPI for at-home was +2.3%, up from Q1’s +1.8%. Added convenience may be a driver. We’ve been surprised by the ongoing strength in store delivery. Instacart reported a +17% increase in orders for Q1, up from the Q1 rate of +14%. Walmart has shared that store-delivery is growing substantially, especially by more affluent households.

As readers know well, anything housing-related has been in the dumps since 2022. Mattress retail has been especially in the dumps, with production volumes well below the levels of 2009 and the Great Financial Crises. However, the trend now appears to be slightly improving despite the 30-year mortgage rate still at 6.5%, based on early reports; what gives? Somnigroup (the rebranded Tempur Pedic company, along with its purchase of Mattress Firm) reported better top-line results today.

McDonald’s reported a much-improved US comp-sales increase of 2.5%, a 510bps QoQ improvement. Advan data estimates that traffic improved 200bps QoQ and that ticket improved 300 bps to a +2.1% increase. The 2.1% increase is less than inflation (CPI) at 3.5% indicating that McDonald’s is underpricing the market in order to amplify its value positioning; we know that they are aggressively messaging “McValue” deals. CEO Chris Kempczinski said, “Overall, we’ve made good progress with our value offerings.