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 PepsiCo Inc. (PEP), Walmart Inc. (WMT), and Costco Wholesale Corp. (COST). Consumer staples stocks, as represented by the Consumer Staples Select Sector SPDR ETF (XLP), have underperformed the broader market with a total return of 2.5% compared to the S&P 500's total return of 5.1% over the past 12 months. These market performance numbers and the statistics in the tables below are as of May 22.
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)||47.18||14.2||9.9|
|Tyson Foods Inc. (TSN)||59.25||21.6||11.0|
|Archer-Daniels Midland Co. (ADM)||35.12||19.5||12.9|
- 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.
- 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 earlier this month that some of its production facilities were resuming operations after being temporarily shut down to test its team members for COVID-19 and limit the spread of the virus. Tyson also has begun advanced testing for the virus at a number of its facilities.
- Archer-Daniels Midland Co.: Archer-Daniels Midland procures, transports, stores, processes, and merchandises agricultural commodities, products, and ingredients worldwide. The company processes oilseeds, corn, milo, oats, barley, peanuts, wheat, and more.
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 (%)|
|Archer-Daniels Midland Co. (ADM)||35.12||19.5||68.3|
|Coca-Cola Co. (KO)||45.17||194.0||64.1|
|JM Smucker Co. (SJM)||107.90||12.3||53.3|
- Archer-Daniels Midland Co.: See above for company description.
- Coca-Cola Co.: Coca-Cola is a non-alcoholic beverage company engaged in the manufacture and sale of nonalcoholic beverages, including soft drinks, water, enhanced water & sports drinks, juice, dairy and plant-based beverages, tea & coffee, and energy drinks. The company reported a 1% decline in net revenue for Q1 2020. Coca-Cola also noted that the coronavirus pandemic was hurting its volume. Since the beginning of April through April 21, volume declined approximately 25% globally.
- JM Smucker Co.: JM Smucker manufactures food products for global sale. The company is best known for its fruit spreads, peanut butters, and shortenings and oils. The company announced in April that it was withdrawing its guidance for the 2021 fiscal year (FY) due to the uncertainty related to the coronavirus 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 (%)|
|Target Corp. (TGT)||118.68||59.3||69.0|
|Dollar General Corp. (OG)||178.41||44.9||48.0|
|Clorox Co. (CLX)||199.40||25.1||38.1|
|Consumer Staples Select Sector SPDR ETF (XLP)||N/A||N/A||2.5|
- 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. Target reported 10.8% growth in comparable sales for Q1 2020. The company also withdrew its full-year guidance for FY 2020 due to the uncertainty related to the COVID-19 pandemic.
- 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 announced in late March plans to hire an additional 50,000 employees by the end of April in order to support increased demand for household essentials amid the ongoing pandemic.
- 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. But the company also offers different food products, water-filtration systems and filters, and natural personal care products. Clorox announced earlier this month the promotion of Linda Rendle to the role of President.
YCharts. "Financial Data," Accessed May 22, 2020.
Tyson Foods Inc. "Joint Statement on Tyson Fresh Meats Resuming Operations in Logansport, Ind.," Accessed May 25, 2020.
Tyson Foods Inc. "Tyson Fresh Meats to Resume Waterloo, Iowa Operations," Accessed May 25, 2020.
Tyson Foods Inc. "Tyson Foods, Inc. Releases Results From Covid-19 Testing at Temperanceville, Va Plant," Accessed May 25, 2020.
Coca-Cola Co. "Coca-Cola Reports First Quarter 2020 Results; Provides Update on Business Environment Amid Coronavirus Pandemic," Accessed May 25, 2020.
JM Smucker Co. "The J. M. Smucker Company Provides Operational and Financial Update Related to COVID-19," Accessed May 25, 2020.
Target Corp. "Target Corporation Reports First Quarter Earnings," Accessed May 25, 2020.
Dollar General Corp. "Dollar General to Hire Up to 50,000 New Employees to Support Operations," Accessed May 25, 2020.
Clorox Co. "Clorox Announces Linda Rendle's Appointment to President," Accessed May 25, 2020.