The protein boom is only beginning: Morning Brief
Protein Doritos sounds like the ideal mashup for the gym rat snack fiends of the world. But it's not as farfetched a product as you might think. Pepsi (PEP) plans to unveil new protein offerings for some of its Frito-Lay and Quaker brands, part of a broader shift to enhance their products and strip away artificial flavors and colors. (But what is a tasty Cheeto if not a brazenly synthetic delight?)
Pepsi's intended relaunch and extension of popular brands is a reaction to a consumer base on the hunt for healthier, cleaner options. Executives across the food and beverage world see a potential crisis unfolding. As demand for legacy products wavers, companies are reaching for new lines (like fiber, prebiotics, hydration, energy, and protein) to support the core business.
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"Protein is clearly a subsegment in our food and beverages categories that is growing fast," said PepsiCo CEO Ramon Laguarta on an earnings call last week. "Consumers are adopting protein solutions in the diet at a pace that was not the case a few months back, a few years back."
Coca-Cola (KO), which reported on Tuesday, is undergoing its own notable evolution. Earlier this year, the company came out with a prebiotic soda brand, Simply Pop, an answer to the initial success of soda alternatives like Olipop and Poppi. Coca-Cola's Fairlife line of lactose-free, ultra-filtered milk and protein shakes (a fitness influencer staple) is touting double-digit volume growth.
Coke CFO John Murphy told my colleague Brooke DiPalma that protein is another representation of consumers looking for products that help them in their daily lives, have fewer calories, or are perceived as healthier. Coca-Cola also confirmed it'll offer a Coke variant sweetened with US cane sugar this fall.
A confluence of factors has amped up the recommendations and ability to up your protein intake.
Strength training is having a moment, in a sort of vindication of gym bro fitness culture but also an expansion and reimagining of it. More young people, older people, and women are skipping (or supplementing) the treadmill and stationary bike and heading to the weight rack.
Big, commercial gyms are swapping out cardio machines to make space for pumping iron. Planet Fitness (PLNT) announced plans at the start of the year to install new plate-loaded strength equipment — like bench presses and hack squats — into all of its more than 2,700 clubs by the end of 2025. Logically, protein follows to help realize the gains.
Social media reflects and amplifies these trends. Popular influencers, like some of their Hollywood counterparts, are sporting more muscular physiques: wider backs, denser arms, and thicker legs. And they're touting the advantages of higher protein consumption as a method to change the way people look and feel. You have to eat more protein, they proclaim, to grow a dump truck.
The opposite is true too: You generally need to actually train to put protein to work — and we may all be going overboard. Otherwise, you're just eating protein aspirationally.
The explosion of GLP-1 weight-loss drugs from Eli Lilly (LLY) and Novo Nordisk (NVO) is another reason why consumers are seeing more protein-enriched foods on grocery aisles. As appetite-suppressed Ozempic and Wegovy users eat less and drop pounds, it isn't just body fat they're shedding. People in a calorie deficit generally lose fat and muscle, so healthcare providers advise patients to eat more protein to help preserve their muscle mass.
And as a diet trend, the pro-protein movement is also just that, "pro" something, instead of the carb villainization of Atkins of the 2000s or low-fat of the 90s and before. For food and snack companies, it's an opportunity to capitalize on that turbocharged demand by providing something that's acceptable to eat, tackling health through consumption instead of austerity.
So far, the market is gobbling it up.
Hamza Shaban is a reporter for Yahoo Finance covering markets and the economy. Follow Hamza on X @hshaban.
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$1.5 billion acquisition of Herb Chambers auto group is complete
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So we're, instead of consumer discretionary, we have consumer staples. That's the stuff that you need to buy, healthcare, utilities, and energy. Energy is an interesting one because it's almost countercyclical, but it is defensive in nature. It tends to outperform when the Fed is doing certain things in the business cycle. Beyond the scope of this conversation, but for here we're going to classify it as defensive. This leads to the next chart, which is really jaw-dropping. This comes from Todd Sohn over at Strategas ETF Research. I call him the ETF whisperer. And this shows you all the defensive sectors combined versus two stocks, Nvidia plus Microsoft, how much they are taking up in the S&P 500. So let's do, uh, the defensive. I'm going to trace these sectors out first. They started at 40% in 1990, and then since the early 2000s, they have just drifted down. They are only at 20% today. Then you take the Microsoft and Nvidia combo, and Nvidia only came to market in the late 1990s. 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And then after the bear market of 2022 right here, we got a rebound to massively new highs in the S&P 500, but the ratio XLY to XLP was only able to get to that prior peak right here. And I'm going to clear the annotations and show you that even though the S&P 500 has reached record highs recently, XLY to XLP has, uh, kind of stayed there below its, uh, recent highs. And I think this kind of ties into the argument that we have seen narrow breadth in this S&P 500 rally, which is not a sell sign, but it is a yellow warning flag, uh, going forward. So wrapping it up here, tune into Stocks and Translation podcast for more jargon-busting deep dives, new episodes. You can find them on Tuesdays and Thursdays on Yahoo Finance's website or wherever you find your podcasts. 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Yahoo
12 hours ago
- Yahoo
The protein boom is only beginning: Morning Brief
They're cramming it into everything now. It's in pancakes and pasta, chips and cereal. Plant-based or harvested from the farm, it's the macro(nutrient) of the moment. And slices of corporate America are not so subtly asking: Have you met your protein goal today? Protein Doritos sounds like the ideal mashup for the gym rat snack fiends of the world. But it's not as farfetched a product as you might think. Pepsi (PEP) plans to unveil new protein offerings for some of its Frito-Lay and Quaker brands, part of a broader shift to enhance their products and strip away artificial flavors and colors. (But what is a tasty Cheeto if not a brazenly synthetic delight?) Pepsi's intended relaunch and extension of popular brands is a reaction to a consumer base on the hunt for healthier, cleaner options. Executives across the food and beverage world see a potential crisis unfolding. As demand for legacy products wavers, companies are reaching for new lines (like fiber, prebiotics, hydration, energy, and protein) to support the core business. Sign up for the Yahoo Finance Morning Brief By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy "Protein is clearly a subsegment in our food and beverages categories that is growing fast," said PepsiCo CEO Ramon Laguarta on an earnings call last week. "Consumers are adopting protein solutions in the diet at a pace that was not the case a few months back, a few years back." Coca-Cola (KO), which reported on Tuesday, is undergoing its own notable evolution. Earlier this year, the company came out with a prebiotic soda brand, Simply Pop, an answer to the initial success of soda alternatives like Olipop and Poppi. Coca-Cola's Fairlife line of lactose-free, ultra-filtered milk and protein shakes (a fitness influencer staple) is touting double-digit volume growth. Coke CFO John Murphy told my colleague Brooke DiPalma that protein is another representation of consumers looking for products that help them in their daily lives, have fewer calories, or are perceived as healthier. Coca-Cola also confirmed it'll offer a Coke variant sweetened with US cane sugar this fall. A confluence of factors has amped up the recommendations and ability to up your protein intake. Strength training is having a moment, in a sort of vindication of gym bro fitness culture but also an expansion and reimagining of it. More young people, older people, and women are skipping (or supplementing) the treadmill and stationary bike and heading to the weight rack. Big, commercial gyms are swapping out cardio machines to make space for pumping iron. Planet Fitness (PLNT) announced plans at the start of the year to install new plate-loaded strength equipment — like bench presses and hack squats — into all of its more than 2,700 clubs by the end of 2025. Logically, protein follows to help realize the gains. Social media reflects and amplifies these trends. Popular influencers, like some of their Hollywood counterparts, are sporting more muscular physiques: wider backs, denser arms, and thicker legs. And they're touting the advantages of higher protein consumption as a method to change the way people look and feel. You have to eat more protein, they proclaim, to grow a dump truck. The opposite is true too: You generally need to actually train to put protein to work — and we may all be going overboard. Otherwise, you're just eating protein aspirationally. The explosion of GLP-1 weight-loss drugs from Eli Lilly (LLY) and Novo Nordisk (NVO) is another reason why consumers are seeing more protein-enriched foods on grocery aisles. As appetite-suppressed Ozempic and Wegovy users eat less and drop pounds, it isn't just body fat they're shedding. People in a calorie deficit generally lose fat and muscle, so healthcare providers advise patients to eat more protein to help preserve their muscle mass. And as a diet trend, the pro-protein movement is also just that, "pro" something, instead of the carb villainization of Atkins of the 2000s or low-fat of the 90s and before. For food and snack companies, it's an opportunity to capitalize on that turbocharged demand by providing something that's acceptable to eat, tackling health through consumption instead of austerity. So far, the market is gobbling it up. Hamza Shaban is a reporter for Yahoo Finance covering markets and the economy. Follow Hamza on X @hshaban. Click here for in-depth analysis of the latest stock market news and events moving stock prices
