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According to Morgan Stanley, major weight-loss drugs are seeing greater uptake and interest, and those who use them are spending less when grocery shopping.
An updated Numerator survey of 92,000 people showed that 12.3% of households reported having a member taking GLP-1 like the one from Novo Nordisk (NGO) Ozempic and Wegovy and Eli Lilly (NYSE: LLY) Mounjaro and Zepbound.
“Monthly spending on the categories most influenced by GLP-1 users for weight loss includes snacks, pastries and ice cream, while yogurt, fish and vegetable snacks have the most positive impact,” said analyst Pamela Kaufman and his team. “Our previous investigative work suggests a notable reduction in consumption of less healthy categories when taking GLP-1 drugs.”
Families “spend more on groceries than non-GLP-1 HHs, but their spending decreases after they begin using medications. Before starting treatment, GLP-1 HHs spent an average of more than $150 on more per month for groceries than non-GLP1 HHs,” Kaufman said . “Part of the difference reflects larger family size, higher income, larger number of children and, overall, higher food expenditure.”
“When monthly grocery spending is indexed to offset the above differences, monthly grocery spending among GLP-1 HHs fell 6% to 9% more than the change in spending among non-GLP-1 households.” .
Top grocery stocks include Walmart (WMT), Target (TGT), Kroger (KR), and Albertsons (ACI).