Retail and restaurant companies have repeatedly left their earnings forecasts unchanged, making pricing power a focus for the future. With profit trends for the current fiscal year remaining flat, companies' ability to pass on higher prices and its impact on earnings are being put to the test.
As retail and restaurant companies announce their earnings, cases in which their earnings outlooks for the current fiscal year are left unchanged have become conspicuous. With companies seeing limited growth in revenue and profit, how they manage rising costs has become a challenge.
The view is spreading that differences in the ability to pass on higher prices will affect companies' financial positions, making the ability to implement price increases and their feasibility matters of interest to investors.