The hallmark of consumer staples is consistent performance. The goods these companies sell tend to have stable demand, no matter what the economy is doing. This is because demand for non-cyclical products like food, drinks, tobacco and other common household goods rarely wane. Thus, the companies that produce these products tend to be relatively stable in both good times and bad. Investors who are seeking a safe haven during rough times should consider adding a few of these consumer staples stocks to their portfolios. (To learn more, see A Guide To Investing In Consumer Staples.)

IN PICTURES: 5 Tips To Reading The Balance Sheet

Playing It Safe
A quick search for consumer staples that have a market capitalization of more than $300 million shows more than 100 stocks from varying industries. To further narrow down our search for prospective additions into our portfolios, let's examine potentially undervalued consumer staples using the PEG ratio. The PEG ratio takes a stock's PE ratio and divides it further by the stock's annual growth rate. PEG ratios below 1 often indicate that the stock is undervalued. (To learn more, see How To Find P/E And PEG Ratios.)

This combination of factors yield stocks that can not only weather harsh economic conditions, but are also trading below their true values.

The Results
We sifted through consumer staple stocks to find the most undervalued picks. If it's security and stability you're after, these stocks are worth a look.

Company PEG Ratio Market Cap (Billions)
ZHONGPIN (Nasdaq:HOGS) 0.54 0.538

The Bottom Line
One of the biggest draws of consumer staples stocks is slow and steady growth. While companies in more cyclical industries can swing wildly based on the economy, the staples tend to move in smaller, more predictable patters. Boring? Maybe. But for some investors, slow and steady is just right.

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!