Shipping costs are falling quickly, and Oppenheimer thinks some retailers can greatly benefit from it. The World Container Index, which tracks the cost of a 40-foot container on eight major routes through both short- and long-term contracts, was down 8% this week to $3,688.75 per container. That marks the 32nd straight weekly decrease, with prices now down about 64% off the high posted in September 2021. “We are hard-pressed to envision most all consumer enterprises not benefiting, to some degree, from moderating overseas shipping costs, and generally less turbulence in global supply chains,” Oppenheimer analyst Brian Nagel said. “Interestingly, moderating procurement costs should go a long way in offsetting, if not negating, the impacts of normalizing promotional activity, particularly in areas such as home furnishings and sporting goods,” he added. Nagel highlighted several retailers that stand from this decline in shipping costs. These stocks are rated outperform by Oppenheimer. One name that made the list is Nike . The apparel giant has in the past attributed troubles to the surging dollar and oversupply. The company said in late September that it would look to promotions as inventory grew 44% in the first quarter compared to the same period a year ago. Its stock is down about 47% year to date. Meanwhile, Lululemon said last month that it saw shoppers still buying their apparel even as rising prices and inflationary concerns hurt competitors. The stock is down 23% this year. To be sure, Nagel said the decrease in the shipping costs could signal sliding demand for consumer products, as inflationary pressures and a shift in spending from goods to services hurt demand in the sector. However, he added that this is more likely a sign of easing supply chain issues that were driving up costs. — CNBC’s Michael Bloom contributed to this report.
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