The consumer staples sector is comprised of companies that produce and sell items considered essential for everyday use. Consumer staples products 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), among others.
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 5.7% compared to the Russell 1000's total return of 11.0% over the past 12 months. These market performance numbers are as of September 23 and the statistics in the tables below are as of September 24.
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|
|Albertsons Companies Inc. (ACI)||13.62||6.4||7.0|
|Campbell Soup Co. (CPB)||45.18||13.7||8.4|
|The Kroger Co. (KR)||33.28||25.8||10.2|
- Albertsons Companies Inc.: Albertsons Companies operates grocery and drug stores throughout the U.S. In its Q1 FY 2020, ended June 20, the company reported year-over-year (YOY) digital sales growth of 276%, which Albertsons attributed to the COVID-19 pandemic.
- 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. For its FY 2020, ended August 2, Campbell Soup reported a 7% YOY gain in net sales, and a 24% increase in earnings per share (EPS) from continuing operations. These gains were driven largely by YOY fiscal Q4 net sales gains of 18%, which Campbell attributed to increases in sales for its soups, pasta, pasta sauces, and V8 beverages amid the COVID-19 pandemic.
- 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 YOY 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 (%)|
|Albertsons Companies Inc. (ACI)||13.62||6.4||1,350|
|Ollie's Bargain Outlet Holdings Inc. (OLLI)||86.55||5.7||294.7|
|The Kroger Co. (KR)||33.28||25.8||178.4|
- Albertsons Companies Inc.: See above for company description.
- Ollie's Bargain Outlet Holdings Inc.: Ollie's Bargain Outlet Holdings is a holding company which, through subsidiaries, owns and operates retail stores providing brand name products at discounted or closeout prices. Among the wide variety of products sold at Ollie's Bargain Outlet locations are housewares, books and stationery, bed and bath products, floor coverings, hardware, toys, and food. Ollie's President and Chief Executive Officer John Swygert described the company's Q2 FY 2020, ended August 1, as the best quarter in the company's 38-year history. Among other highlights, net sales increased by 58.5% YOY, gross profit increased by 66.8% YOY, and the company opened six new locations in the quarter.
- The Kroger Co.: See above for company description.
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 (%)|
|Boston Beer Co. Inc. (SAM)||895.63||10.9||152.3|
|Chegg Inc. (CHGG)||69.95||9.0||105.7|
|2U Inc. (TWOU)||33.89||2.2||97.4|
|Consumer Staples Select Sector SPDR ETF (XLP)||N/A||N/A||5.7|
- Boston Beer Co. Inc.: Boston Beer Co. produces craft-brewed beers and ciders, both through its own breweries and through contracts with outside breweries. Among the company's most popular brands are Samuel Adams, Oregon Beer and Brewing, and HardCore. Boston Beer Co. sells its products to wholesale distributors.
- Chegg Inc.: Chegg offers online educational services including homework help, and course selection, as well as products including textbooks for rent and manuals. For Q2, Chegg reported a 63% YOY increase to net revenue and net income of $10.6 million. The company also raised its guidance for 2020 based on the increasing demand for online education services amid the ongoing COVID-19 pandemic.
- 2U Inc.: Like Chegg above, 2U provides online educational services. The company provides both undergraduate and graduate degree programs in a variety of fields including social work, public administration, healthcare, law, and data science, among others. 2U offers these services to customers around the world.
YCharts. "YCharts." Accessed Sept. 26, 2020.
Albertsons Companies Inc. "Albertsons Companies, Inc. Reports First Quarter Results." Accessed Sept. 27, 2020.
Campbell Soup Co. "Campbell Reports Fourth-Quarter and Full-Year Fiscal 2020 Results." Accessed Sept. 27, 2020.
Ollie's Bargain Outlet Holdings Inc. "Ollie’s Bargain Outlet Holdings, Inc. Reports Record Second Quarter Fiscal 2020 Financial Results." Accessed Sept. 27, 2020.
Chegg Inc. "Chegg Reports Second Quarter Results and Raises Guidance for 2020." Accessed Sept. 27, 2020.