Analyst Ratings January 26, 2026

KeyBanc Finds Consumers Expect to Lift Spending as Tax Refunds Loom

Survey shows holiday-season spending rebound and planned near-term increases across retail, travel and home categories; Patrick Industries cited as a potential beneficiary

By Leila Farooq PATK
KeyBanc Finds Consumers Expect to Lift Spending as Tax Refunds Loom
PATK

KeyBanc Capital Markets' January survey of 1,056 U.S. consumers found a rebound in holiday spending and plans to raise outlays over the next three months across a broad set of categories. Analysts point to forthcoming policy-driven tax-refund increases that could add 2-4% to retail sales in early 2026, and KeyBanc highlights winners among retailers and leisure suppliers. Patrick Industries (PATK) is identified as potentially advantaged, though some research flags valuation concerns.

Key Points

  • KeyBanc's Jan. 7-8 survey of 1,056 U.S. consumers found 43% spent more during the 2025 holiday season, matching 2023 and up from 24% in 2024.
  • Consumers plan to increase spending over the next three months across grocery, travel, autos, clothing, beauty, restaurants, convenience stores and home décor/furniture - areas that could benefit suppliers like Patrick Industries (PATK).
  • KeyBanc estimates OBBBA-related higher tax refunds and related changes could add 2-4% to retail sales in H1 2026; firms that emphasize execution, newness and pricing discipline are favored.

KeyBanc Capital Markets' latest quarterly consumer survey suggests rising spending momentum as the U.S. heads into 2026. Conducted on January 7-8 with a sample of 1,056 domestic consumers, the poll found that 43% of respondents reported spending more during the 2025 holiday season - a level that KeyBanc notes matches results from 2023 and stands well above the 24% who said the same in 2024.

The survey indicates consumers expect to increase expenditures over the next three months across multiple categories. Respondents signaled planned increases in grocery purchases, leisure and travel spending, automobile purchases, retail clothing, beauty products, restaurants, convenience stores and home décor and furniture.

KeyBanc highlighted that companies supplying leisure, housing and related consumer markets could gain from the shift. Patrick Industries (PATK) was cited as an example of a supplier positioned to benefit from higher household spending in areas such as RVs, marine products and housing components. Patrick Industries has produced a 37.9% total return over the past year and is scheduled to report quarterly results on February 5. Separately, InvestingPro analysis flagged Patrick Industries as appearing overvalued at current levels despite its strong performance.

KeyBanc analyst Bradley Thomas called attention to expected policy-driven tailwinds tied to the Opportunity for Better Benefits and Affordable Care Act - referred to in the survey as OBBBA. Thomas estimated that the net effect of higher tax refunds and related tax changes could boost retail sales by roughly 2-4% in the first half of 2026. The package of changes referenced by KeyBanc includes larger tax refunds, increased state and local tax (SALT) deductions for homeowners, and the elimination of taxes on tips and overtime income.

Within the consumer landscape, the survey suggests uneven impacts across subsectors. Fast-casual restaurant stocks, KeyBanc warned, may experience heightened volatility in the months ahead. By contrast, retailers that serve higher-income consumers are projected to capture a disproportionate share of any tax-refund-related spending uplift. In its sector guidance, KeyBanc emphasized companies that combine execution, product newness and disciplined pricing as the likeliest to translate the expected demand into stronger results.

Patrick Industries was described as financially well-equipped to pursue growth opportunities tied to the spending outlook. The company reported a current ratio of 2.34, which KeyBanc interprets as indicating solid near-term liquidity. Corporate actions at Patrick Industries reinforce an active period of strategic and shareholder-focused moves: the company increased its quarterly dividend by 17.5% to $0.47 per share, effective December 15, 2025, and completed changes in senior management. Matthew Filer has been appointed chief financial officer, succeeding Andrew Roeder, who will remain with the company through the fiscal year-end filing. In operations leadership, Kip B. Ellis resigned as president of powersports and housing, with Hugo E. Gonzalez assuming that role immediately.

Analyst coverage of Patrick Industries has shown upward adjustments alongside buy ratings: Benchmark raised its price target to $140, while Truist Securities increased its target to $126, both maintaining Buy recommendations. KeyBanc pointed to these developments as part of a broader phase of strategic repositioning and investor optimism around the company.

Overall, KeyBanc's consumer survey paints a picture of recovering household willingness to spend, with tax-refund expectations identified as a potentially material driver of early-2026 retail activity. The survey also signals differential outcomes by sub-sector and income cohort, and highlights the potential for company-level liquidity and execution to determine who benefits most.


Summary

KeyBanc's January survey of 1,056 U.S. consumers shows a rebound in holiday spending and plans for higher near-term expenditure across groceries, travel, autos, apparel, beauty, dining, convenience stores and home décor/furniture. Policy changes tied to OBBBA are expected to raise tax refunds and could add roughly 2-4% to retail sales in the first half of 2026. Patrick Industries (PATK) is noted as a potential beneficiary though InvestingPro data indicates valuation concerns.

Risks

  • Fast-casual restaurant stocks may face significant volatility in the near term, creating uncertainty for that subsector.
  • Retail gains from expected tax refunds may be concentrated among higher-income consumers, limiting broader benefits to mass-market retailers.
  • Valuation concerns for individual companies exist despite strong price performance, as reflected by InvestingPro's assessment of Patrick Industries as appearing overvalued.

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