Consumer staples have had a difficult year so far—and while the stocks have gotten significantly cheaper, that may not be enough to entice investors back to the sector as a whole.

The Consumer Staples Select Sector SPDR exchange-traded fund (ticker: XLP) is off about 1% percent so far this year, while the S&P 500 and the Consumer Discretionary Select Sector SPDR ETF (XLY) are up more than 12% and 22%, respectively. Investors abandoned the safe harbors they flocked to during 2022's bear market: This year's market rally been driven almost entirely by Big Tech stocks that were laggards last year.

At the same time, staples stocks have given investors few reasons to stay, according to Wells Fargo analyst Chris Carey. After a "historic" first quarter earnings season that provided "the best quarter in staples in a generation," the second quarter appears to be much more lackluster, he said in a Wednesday note.

His analysis of Nielsen data show that out of 18 staples companies, ten are notching organic sales behind consensus expectations so far in the second quarter. Still, Carey said he's "not calling…doom and gloom on the second quarter per se," since he thinks it will likely level out to revenue results roughly in-line with expectations. However, he says the "problem [is] that's just much different vs the first quarter."

Some investors, though, have likely braced for a downturn in consumer staples. Companies raised prices to compensate for higher input costs, but those hikes appear to have peaked in late 2022. Pricing pressure now appears to be heading in the opposite direction—just as the total volume of goods is being impacted by shoppers pulling back in the face of higher costs.

"Ultimately, the challenge facing the space – as is well documented at this point – is that pricing is going to decelerate meaningfully ahead, just as volumes are negative for many," Carey said. This worry, he says, means that even companies with strong results may get side-eyed by the market, given investors are just waiting for the shoe to drop on prices.

"Big beats may not be trusted (if entirely driven by pricing at the expense of volume)," Carey said.

While many Americans continue to grapple with inflation, it's nonetheless cooling—so investors may be wondering if consumer staples companies will give up the pricing power they gained to juice sales. In the past few quarters, many home and packaged food companies, such as PepsiCo (PEP) and Mondelez International (MDLZ), were able to demonstrate that higher prices weren't cutting into total sales very much, but many on Wall Street expect to see companies eventually choose between margin and top-line growth to some extent.

"This is why – rightly so – volumes are getting so much attention all of the sudden," Carey notes.

There is one bright spot: Staples' underperformance means that "at least valuations look more reasonable" since they've returned to historical averages, Craey says. He adds that if multiples continue to contract—as they did in the frenzied recovery from the global financial crisis—investors may be able to pick up some quality companies cheaply.

Carey said the companies recommended in his earlier work—such as Keurig Dr Pepper (KDP), Constellation Brands (STZ), Coca-Cola (KO), and Mondelez—are likely to buck this trend and deliver sustainable volume growth thanks to company-specific factors that are driving sales.

However, he says that General Mills (GIS), Kimberly-Clark (KMB), and Molson Coors Brewing Co. (TAP) all sport volumes that have negative compound annual growth rate over a multi-year period that may be difficult to overcome.

For those with compelling catalyst ahead, though, Carey says that "Valuation relief plus [the] worst underperformance vs the market in 20 years has at least lowered the bar."