Consumer staples stocks represent companies manufacturing common household products considered essential for everyday use. Such products include home 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. Because of this, consumer staples companies are viewed as non-cyclical and able to maintain stable growth regardless of the state of the economy. Some of the big names in the sector include Costco Wholesale Corp. (COST), Philip Morris International Inc. (PM), and Colgate-Palmolive Co. (CL) . Over the previous 12-month period, consumer staples stocks as represented by the Consumer Staples Select Sector SPDR ETF (XLP) have underperformed the S&P 500, gaining 22.1% as compared with 27.3% for the S&P. All figures in this story are as of January 6, 2020.
We'll take a look at the top 3 consumer staples stocks for January 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|
|The Kroger Co. (KR)||28.80||23.1||14.5|
|General Mills Inc. (GIS)||52.59||31.8||14.9|
|PepsiCo Inc. (PEP)||136.15||189.9||15.5|
- 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.
- General Mills Inc.: General Mills manufactures and markets branded consumer foods and pet food products sold through retail stores. The company is also a supplier of branded and unbranded food products to the foodservice and commercial baking industries.
- PepsiCo Inc.: PepsiCo is a food and beverage company that manufactures, markets, distributes and sells beverages, food, and snacks. The company's portfolio of brands includes Frito-Lay, Gatorade, Pepsi-Cola, Quaker, and Tropicana. Early last month, PepsiCo announced plans to acquire BFY Brands, the maker of PopCorners snacks.
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 (%)|
|Walmart Inc. (WMT)||117.65||333.8||98.3|
|Conagra Brands Inc. (CAG)||33.52||16.3||71.0|
|General Mills Inc. (GIS)||52.59||31.8||66.7|
- Walmart Inc.: Walmart operates retail and wholesale businesses. The company offers a broad assortment of merchandise including apparel, house wares, small appliances, electronics, books, home improvement, jewellery, games, pharmaceutical products, household essentials, and automotive tools. Walmart reported YOY revenue growth of 2.5% and YOY EPS growth of 98.3% for Q3 of fiscal year 2020, the three-month period ending October 31, 2019.
- Conagra Brands Inc.: Conagra Brands engages in the manufacture and marketing of processed and packaged foods. The company produces and sells items including packaged meals, condiments, entrees and sides, snacks, specialty potatoes, milled grain ingredients, dehydrated vegetables and seasonings, and blends.
- General Mills Inc.: See company description above.
Consumer Staples Stocks with the Most Momentum
These are the consumer staples stocks that had the highest percentage price change over the last 12 months.
|Consumer Staples Stocks with the Most Momentum|
|Price ($)||Market Cap ($B)||12-Month Price Change (%)|
|Target Corp. (TGT)||123.58||62.6||77.4|
|Tyson Foods Inc. (TSN)||90.15||32.3||60.8|
|Coty Inc. (COTY)||10.85||8.2||43.7|
|Consumer Staples Select Sector SPDR ETF (XLP)||N/A||N/A||22.1|
- 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 YOY revenue growth of 4.7% and YOY EPS growth of 18.5% for Q3 of 2019, the three-month period ending November 2, 2019.
- Tyson Foods Inc.: Tyson Foods produces, distributes, and markets chicken, beef, and pork, as well as prepared foods. Some of the company's leading brands include Sara Lee, Ball Park, and State Fair.
- Coty Inc.: Coty manufactures and distributes branded beauty products including fragrances, color cosmetics, hygiene, sun care, and skin treatment products. Coty announced on Monday that it is entering into a long-term strategic partnership with Kylie Jenner in order to jointly build and further develop the celebrity's existing beauty business into a global powerhouse brand.
Yahoo! Finance. "Consumer Staples Select Sector SPDR Fund (XLP) Price Chart," Accessed Jan. 6, 2020.
Yahoo! Finance. "S&P 500 (^GSPC) Price Chart," Accessed Jan. 6, 2020.
PepsiCo Inc. "PepsiCo Announces Definitive Agreement to Acquire BFY Brands Expanding Better-For-You Portfolio and Production Capabilities," Accessed Jan. 7, 2020.
Walmart Inc. "Earnings Release Q3 FY20," Page 5. Accessed Jan. 7, 2020.
Target Corp. "Target Reports Third Quarter 2019 Earnings," Accessed Jan. 7, 2020.
Coty Inc. "Coty and Kylie Jenner Commence Strategic Partnership," Accessed Jan. 7, 2020.