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September 4, 2025
Our Portfolio Manager, Sam LaBell, joined BNN Bloomberg to discuss labour trends, consumer spending, tariffs and a key holding, Alimentation Couche-Tard Inc. (TSX: ATD), that had just reported its Q1-F26 results the previous day.
The U.S. economy is in a holding pattern, Sam said. On the one hand, unemployment remains low and wage gains are strong, but the labour market is softening, and low- to middle-income consumers are pulling back on spending. “Companies like McDonald’s are saying there is really a two-tier economy. People at the higher income levels are continuing to order in and continuing to pay for premium meals, but they’re seeing a lot of softness in the lower income and middle-income consumers who are opting not to shop or purchase McDonald’s meals.”
There is also continued uncertainty about how tariffs will impact the U.S. economy and whether the U.S. will cut interest rates before Federal Reserve Chairman Jerome Powell’s term ends in May 2026.
As for Alimentation Couche-Tard, Sam discussed it when he last appeared on BNN on July 4, saying he thought it was a turnaround candidate. At that time, some institutional investors were disappointed that the company was trying to buy Seven & i Holdings Ltd. of Japan and the company’s U.S. sales were also weak, particularly with the low-end consumer.
The stock rebounded later in July after the company dropped its plans to acquire Seven & i and also responded positively to Q1-F26 results showing a rebound in U.S. same-store sales growth, Sam said.
There are longer-term concerns about the impact of electric vehicles on the company’s convenience stores at gas stations and how younger people drive less. “But if they get back to their knitting of doing smart acquisitions using their balance sheet, I think that will be very well received by the market.”