As the holiday shopping season approaches, major U.S. retailers from Walmart to Macy’s could be saddled with too much stock for a second straight year, according to a Reuters analysis, jeopardising retailers’ profit margins and generating steep discounts for shoppers.

For Reuters, the financial news and data platform LSEG Workspace computed the inventory turnover ratios of thirty of the largest U.S. retailers. In order to ascertain which chains are most susceptible to possessing surplus inventory, an issue that drives up expenses for retailers, LSEG split each retailer’s cost of goods sold by the mean value of its inventory during the second quarter.

This year, retailers have an even greater challenge due to overcrowded stockrooms because it is anticipated that American consumers will spend only 3% to 4% more this season, which is about inflation. Industry estimates put that at the weakest growth rate in the last five years.

Many businesses have challenges when they carry excess inventory since it increases the cost of processing, storing, and shipping goods.

As per the Reuters investigation, inventory turnover was lower for two-thirds of the thirty businesses, which included Foot Locker, a sporting goods firm, and Ulta Beauty, a beauty store. This suggests that the stores were experiencing slow sales or had excess stock.

According to quarterly reports, the majority of retailers—including Target and Foot Locker—are carrying less inventory than they did a year ago, but the LSEG data on inventory turnover indicates that their levels are still high.

The analysis revealed that this is most significant for chains of dollar stores, department stores, and apparel and accessory stores.