The consumer staples sector is comprised of companies that produce and sell items considered essential for everyday use. These include household goods, food, beverages, hygiene products, and other items that individuals are either unwilling or unable to eliminate from their budgets even in times of financial trouble. As a result, these companies are viewed as non-cyclical and able to maintain stable growth regardless of the state of the economy. The big names in the sector include Procter & Gamble Co. (PG), Coca-Cola Co. (KO), and General Mills Inc. (GIS).
Consumer Staples stocks, as represented by the Consumer Staples Select Sector SPDR ETF (XLP), have underperformed the broader market, providing investors with a total return of 6.0% compared to the S&P 500's total return of 9.0% over the past 12 months. These market performance numbers and the statistics in the tables below are as of July 27.
Here are the top 3 consumer staples stocks with the best value, the fastest earnings growth, and the most momentum.
Best Value Consumer Staples Stocks
These are the consumer staples stocks with the lowest 12-month trailing price-to-earnings (P/E) ratio. Because profits can be returned to shareholders in the form of dividends and buybacks, a low P/E ratio shows you’re paying less for each dollar of profit generated.
|Best Value Consumer Staples Stocks|
|Price ($)||Market Cap ($B)||12-Month Trailing P/E Ratio|
|Campbell Soup Co. (CPB)||49.40||14.9||9.8|
|Tyson Foods Inc. (TSN)||60.82||22.2||11.3|
|The Kroger Co. (KR)||34.71||27.0||13.3|
- Campbell Soup Co.: Campbell Soup manufactures and markets food and beverage products, including Prego pasta sauces, Pace Mexican sauces, Kettle Brand potato chips, Emerald nuts, V8 juices, and more. The company on June 3 reported net income growth of 100.0% on revenue growth of 14.6% for Q3 of its 2020 fiscal year (FY), which ended April 26, 2020. Campbell Soup noted that it saw an increase in demand for its products amid the COVID-19 pandemic.
- Tyson Foods Inc.: Tyson Foods produces, distributes, and markets chicken, beef, pork, and prepared foods. Some of its brands include Hillshire Farm, Sara Lee, and State Fair. The company announced in late June that it had appointed Johanna Söderström to the roles of Executive Vice President & Chief Human Resources Officer.
- The Kroger Co.: Kroger operates supermarkets, drug stores, multi-department stores, jewellery stores, and convenience stores. The company also engages in the manufacture and processing of some of the food it sells in its supermarkets.
Fastest Growing Consumer Staples Stocks
These are the consumer staples stocks with the highest year-over-year (YOY) earnings per share (EPS) growth for the most recent quarter. Rising earnings show that a company’s business is growing and is generating more money that it can reinvest or return to shareholders.
|Fastest Growing Consumer Staples Stocks|
|Price ($)||Market Cap ($B)||EPS Growth (%)|
|J.M. Smucker Co. (SJM)||108.14||12.3||214.3|
|Campbell Soup Co. (CPB)||49.40||14.9||96.4|
|Dollar General Corp. (DG)||191.70||48.3||73.0|
- J.M. Smucker Co.: J.M. Smucker manufactures food products for global sale. The company is best known for its fruit spreads, peanut butters, and shortenings and oils. J.M. Smucker reported on June 4 net income growth of 216.5% on revenue growth of 10.0% for Q4 FY 2020, which ended April 30, 2020. The company noted that it experienced increased consumer demand resulting from the pandemic.
- Campbell Soup Co.: See above for company description.
- Dollar General Corp.: Dollar General is a discount retailer. The company provides a wide variety of merchandise, including paper and cleaning items, food, health and beauty products, tobacco products, kitchen supplies, apparel, gardening supplies, and pet supplies. Dollar General reported on May 28 that net income grew 68.8% on net sales growth of 27.6% for Q1 2020, which ended May 1, 2020. The company noted that it experienced a significant increase in net sales related to the pandemic.
Consumer Staples Stocks with the Most Momentum
These are the consumer staples stocks that had the highest total return over the last 12 months.
|Consumer Staples Stocks with the Most Momentum|
|Price ($)||Market Cap ($B)||12-Month Trailing Total Return (%)|
|The Kroger Co. (KR)||34.71||27.0||67.3|
|Clorox Co. (CLX)||227.04||28.6||42.4|
|Target Corp. (TGT)||123.71||61.9||42.3|
|Consumer Staples Select Sector SPDR ETF (XLP)||N/A||N/A||6.0|
- The Kroger Co.: See above for company description.
- Clorox Co.: Clorox produces and markets consumer and professional products. The company's main products include cleaning and bleach products, charcoal, cat litter, automotive care products, dressings, and trash bags. Additionally, the company also offers food products, water-filtration systems and filters, and natural personal care products. At the beginning of May, Clorox reported net earnings growth of 28.9% on net sales growth of 15.0% for Q3 FY 2020, which ended March 31, 2020.
- Target Corp.: Target owns and operates general merchandise and food discount stores as well as a fully integrated online business. The company offers a wide assortment of general merchandise and food.
YCharts. "Financial Data." Accessed Jul. 27, 2020.
Campbell Soup Co. "Campbell Reports Third-Quarter Results." Accessed Jul. 27, 2020.
Tyson Foods Inc. "Tyson Foods Names Johanna Söderström Chief Human Resources Officer." Accessed Jul. 27, 2020.
J.M. Smucker Co. "The J. M. Smucker Company Announces Fiscal 2020 Fourth Quarter Results." Accessed Jul. 27, 2020.
Dollar General Corp. "Dollar General Corporation Reports First Quarter 2020 Results." Accessed Jul. 27, 2020.
Clorox Co. "Clorox Reports Q3 Fiscal Year 2020 Results, Updates Fiscal Year Outlook." Accessed Jul. 27, 2020.