How Walmart and Costco Could See a Future Flush With Profits Thanks to an Abundance of Cute Puppies

Demographics play a major role in all aspects of life. In terms of household expenditures, age usually dictates where consumer dollars are spent and for what goods and services.

The Conference Board delved into that topic in its March report titled The Impact of Demographic Trends on US Consumer Spending, which lays out the key growth areas in Americans' expenditures between 2015 and 2025. Separately, TheStreet supplemented the report's findings with examples of companies that may be poised to profit when, and if, those changes play out in eight years. 

What's mind-boggling, the study pointed out, is that while the total U.S. population will grow by 8%, the number of those between 70 and 84 will spike by a whopping 50% by 2025. And that could offer lucrative opportunities to companies that cater to the baby boomer generation.

"Better predictions of future demand allow businesses to ensure that production, marketing and delivery capacity will meet future demand," wrote the report's authors Gad Levanon, Brian Anderson, Ben Cheng and Frank Steemers. "More accurate intelligence about future demand is an important advantage over competitors.

"Though exact predictions of demand are never certain, businesses should grasp the opportunity to use what is known about demographic trends to maker better business decisions."

Here is a rundown. 

Healthcare expenses are set to climb by 14%, or $348 billion.
Healthcare expenses are set to climb by 14%, or $348 billion.

"Since the largest demographic force at work is the aging of the baby boomer generation, the fastest-growing categories are those with spending concentrated in the older households, such as healthcare," wrote the authors of the Conference Board report.

They also wrote, "While total household consumption is expected to grow by 8% over the next decade, adding more than U.S. $550 billion to total annual household expenditures, healthcare expenditures will grow by 14% (or U.S. $350 billion in annual growth), faster than any other category considered here."

Among companies that could benefit from this demand are health insurers United HealthCare (UNH) , Blue Cross Blue Shield, owned by Wellpoint, (WLP)  and Aetna (AET)  .

Hospital companies such as LivePoint (LPNT) and Universal Health Services (UHS) , and makers of over-the-counter drugs and supplies like Kimberly Clark (KMB) and Johnson & Johnson (JNJ)  also stand to prosper.

Housing expenses are expected to increase by 8.5%, or $195 billion.
Housing expenses are expected to increase by 8.5%, or $195 billion.

Within the housing category are owned-home repairs, which is projected to grow by 12% or $21 billion, according to the Conference Board. Subsets of that sector tracked in the report include major appliances, seen growing by nearly 10% or some $3 billion; owned dwellings, expected to increase by a projected 8% or some $65 billion; rentals, up 8% or some $36 million; and furniture, projected to rise by 7.4% or $4.1 billion.

Not surprising is that older Americans are the homeowners doing most of the repairs, whereas the younger Americans are renters buying furniture.

Among those companies that may cash in are Home Depot (HD)  and Lowe's (LOW) , REITS like Equity Residential (EQR) , American Campus Communities (ACC) and Silver Bay Reality Trust  (SBY)  , appliance makers like General Electric (GE) , Samsung and Whirlpool (WHR) and furniture makers such as Stanley (STLY) and Hooker (HOFT) .

Entertainment expenses are projected to increase by 8.6%, or some $31 billion
Entertainment expenses are projected to increase by 8.6%, or some $31 billion

The Conference Board study calls out fees and admissions to concerts and movies growing by 7.3% or $6 billion by 2025, fueled by younger Americans. 

Among the beneficiaries could be Live Nation (LYV) , Golden Boy, Dave and Busters (PLAY) and IMAX (IMAX) .

Pet-related expenses are set to grow by 8.5%, or $5.7 billion.
Pet-related expenses are set to grow by 8.5%, or $5.7 billion.

This category has a heavy concentration among older Americans, those in the baby boomer generation, according to the Conference Board. It should expand until the bulk of boomers hit their 70s about a decade from now, said Brian Anderson, one of the study's authors, and then drop off until millennials pick up with pet adoption.

Companies that will likely benefit are retailers Petco, PetSmart (PETM) , pet food makers Blue Buffalo (BUFF)  Spectrum Brand (SPB) and Japanese company Unicharm and sellers of pet furniture, carriers and food and water dispensers, like Amazon (AMZN) , Walmart   (WMT) , Target (TGT)  and Costco (COST) .

Reading expenses are seen growing by 12%, or $2 billion.
Reading expenses are seen growing by 12%, or $2 billion.

One miscellaneous fact from the study is that reading costs will go up, especially among older Americans who will likely have more free time. 

Apple (APPL)  , Amazon (AMZN) and Barnes and Noble (BKS)  could reap rewards as people download books or buy them in physical stores. 

Transportation expenses are expected to grow by nearly 8%, or about $93 billion.
Transportation expenses are expected to grow by nearly 8%, or about $93 billion.

In this category, new cars and vehicle repairs are expected to climb by $19 billion and $9 billion, respectively, by 2025. Those expenses are seen being concentrated among older Americans. Used car costs could grow by $15 billion, focused on younger households.

Many companies may benefit, including carmakers Ford (F)  , General Motors (GM) and Tesla (TSL) , car dealers like AutoNation (AN) , car rental firms Hertz  (HRI) and Avis (CAR) , gas companies Exxon Mobil (XOM) and BP (BP)  and airlines American (AAL) , Delta (DAL) , United (UAL) and Southwest (LUV) .

Food costs are expected to jump by some 8%, or $72 billion.
Food costs are expected to jump by some 8%, or $72 billion.

The Conference Board projects an increase in at-home food costs to rise by 8.5%, or $43 billion by 2025. That could benefit grocers  Kroger (KR)   and Safeway (SWY) . It also expects food eaten out to grow by nearly 8%, or some $29 billion, and that could ring up sales for Darden (DRN)  , McDonald's (MCD) and Domino's Pizza (DPZ) .

Older Americans are more likely to eat at home, while their younger compatriots tend to go out for a meal.

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