Earnings from consumer and technology companies are highlighting shifting demand trends, from price-sensitive shoppers to sustained investment in artificial intelligence infrastructure.
BNN Bloomberg spoke with Laura Lau, CIO at Brompton Group, who pointed to early signs of a turnaround at PepsiCo and continued strength in semiconductor demand, alongside improving signals from freight and real estate sectors.
Key Takeaways
- PepsiCo is seeing early signs of a turnaround as price cuts, smaller packaging and healthier product changes help stabilize snack demand.
- Consumer staples appear expensive, with investors increasingly favouring more growth-oriented and economically sensitive sectors.
- Taiwan Semiconductor posted strong earnings growth and raised guidance, reinforcing that demand for AI chips remains robust.
- Freight indicators are improving, with tighter trucking capacity suggesting a potential shift back toward goods demand.
- Canadian retail REITs are gaining momentum, supported by stable, grocery-anchored assets and renewed investor interest.
Read the full transcript below:
ANDREW: Okay, lots to digest in earnings this morning. PepsiCo posted sales and profit in its latest quarter that topped estimates, and Taiwan Semi beat profit expectations and raised its revenue outlook. We’re joined by Laura Lau, chief investment officer of Brompton Group. Laura, thanks very much indeed for joining us. Let’s have a look at Pepsi over the past five years, a classic defensive stock. But apparently they got too aggressive with price increases, and they’re ratcheting those back now.
LAURA: Yeah. So their crown jewel was Frito-Lay — potato chips, salty snacks — and over the years they had increased prices too much. And then we also have that trend with all those obesity GLP-1 drugs, so people are snacking less, and they really want value for their money. So as a result, Pepsi, the Frito-Lay sales had actually declined over time for chips. So they’ve cut prices, smaller packaging, and they’re also revamping Gatorade, their brand. So what they want to do is have it healthier, less sugar, more electrolytes, remove artificial colours. So they’re in the midst of a turnaround. So far, it looks like it’s working, that the price cuts are working. So that’s been positive for the stock. It’s interesting.
ANDREW: Apparently, their North American foods division posted years of decline in underlying revenue, but there was a turnaround, an actual increase in sales and volumes in the latest quarter.
LAURA: Yeah. So investors are happy that it looks like this turnaround is finally working.
ANDREW: Would you be a buyer of a stock like PepsiCo these days, Laura?
LAURA: Well, right now we find consumer staple stocks are fairly expensive, so that’s why we actually are underweight consumer staples. We actually think that we’re at a point in the cycle where things are actually getting better. The one big, beautiful bill is very expansionary. We do think that one big thing we’ve seen so far this quarter is, surprisingly, the war. Higher gas prices have not really impacted earnings as much as people have expected. People are still buying. Life is still going on. And as a result, we think that we actually would add a little more, something a little torkier than Pepsi.
ANDREW: Okay, you would add something more linked to the economy, or something more growth-oriented?
LAURA: Yes, something more consumer discretionary, something more linked to economic growth.
ANDREW: What about Taiwan Semi? A lot of people, I think, feel, well, I just got to own it. It’s at the centre of the chip business.
LAURA: Taiwan Semi is one of the biggest bottlenecks in the business. They are the premier foundry. Everybody — Nvidia — wants to go to them. So as a result, we can see that the results have been stronger than anybody had even dreamed. Earnings up 58 per cent, and their guidance — they just got it up. Now they’re guiding again, and they’re guiding to the top end of the capital. So it’s basically putting to rest a lot of people’s fears about AI — still game on.
ANDREW: Right. Would you be a buyer of Taiwan Semi right now?
LAURA: Yes, we do own it.
ANDREW: Okay. Netflix expected to report after the bell, of course, locked in a battle with YouTube for dominance of streaming viewing over the internet.
LAURA: I think there’s a place for both, and we’ve seen that they’ve both been able to grow viewership earnings very well. And I think most people use both. And we’ve seen that at the cost of cable. So we do think that certainly, after they called off the deal for Warner Brothers, you’ve seen the stock has rebounded. And what we’ve also seen is it’s kind of been a bit of a safety stock with what’s been happening with the war as well. People are still watching Netflix, and we’re expecting growth from their advertising channel.
ANDREW: JB Hunt Transport — there has been something of a malaise in recent years in these big trucking stocks, but there are signs of the freight market getting tighter.
LAURA: So JB Hunt is one of those bellwethers that most of us in the industry watch, and trucking is one of the big bellwethers as well. Because you know the trend — transports, when they start moving, it’s indicative that the economy is improving. And since COVID, it’s really been, you know, everybody wanted goods. They bought all their goods. And then after COVID reopened, it was services. So this is a sign that the three-year freight recession is starting to end, and we’re starting to see consumers buy more goods. Now it’s not just a services story anymore. And the other thing that’s happened is the trucking business has definitely consolidated. We’ve taken a lot of capacity out of the system. JB Hunt has cut costs, and we’re starting to see some of those volumes come back. So this is definitely one of those bellwethers to watch.
ANDREW: We got this acquisition of First Capital Realty — Westlands in the mix here — and they’re already, of course, huge in retail real estate in Canada. Do you think people will be taking another look at Canadian REITs here, Laura?
LAURA: I think Canadian REITs have actually been silently going up while nobody’s been watching. You started the program saying that Canadian housing is still down, but Canadian REITs have actually started doing better, especially retail REITs. If you watch all of them — Choice, First Capital as well — First Capital has some fantastic retail properties, and a lot of them are grocery-anchored, which is perfect for Choice, which is — I call it Loblaws REIT. So it’s actually a very good match for them. And they’re mostly in Ontario, Quebec — some very good locations. So I think this is a good acquisition for Choice. And we’ve also seen in the U.S. where some of these REITs — industrial REITs, some of these retail REITs — are coming back. And most of the REITs in Canada, especially the retail REITs, are actually anchored. What I mean by that is anchored by, like, Choice REIT — a lot of them are anchored by grocery stores, Loblaws-related, Smart REIT anchored by Walmart, Canadian Tire REIT. So as a result, we see that their cash flows, even in bad times, are still much more stable than anybody expects.
ANDREW: Thank you very much, Laura. Really appreciate it. Laura Lau, chief investment officer of Brompton Group.
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This BNN Bloomberg summary and transcript of the April 16, 2026 interview with Laura Lau are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.
