When markets get choppy, a lot of investors like to turn to consumer staple stocks, which are companies that sell everyday essentials like groceries, cleaning products, and personal care items.
These businesses tend to hold up well during economic downturns since demand for these kinds of products stays steady, no matter what’s happening in the economy.
Whether you’re looking to balance out a growth-heavy portfolio or just looking for some stocks with less volatility, these 10 consumer staples stocks could be worth a closer look today.
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Here are the 3 of our top picks from this list that look the most undervalued today:
PepsiCo (PEP)
- Market Cap: $184 billion
- Industry: Beverages
- Analyst Upside: 14%
- P/E Ratio: 17
Company Overview: PepsiCo is a global leader in food and beverages, with well-known brands like Pepsi, Lay’s, Gatorade, Quaker, and Doritos. The company operates across both drinks and convenience foods, serving customers in retail stores and the foodservice industry.
Business Strategy: PepsiCo is focused today on global expansion, product innovation, and premiumization, where it’s looking to make its brands feel more premium to justify higher prices. It continues to invest in supply chain efficiency and sustainability to drive long-term growth.
Recent Developments:
- Earnings & Profitability: PepsiCo saw solid margin performance, driven by effective pricing strategies and a favorable product mix.
- Business Growth Trends: Growth in emerging markets and rising demand for healthier offerings continue to support Pepsi’s steady top-line expansion.
- Shareholder Returns: PepsiCo has a strong track record of rewarding shareholders through consistent dividends and share repurchases.
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Kraft Heinz (KHC)
- Market Cap: $34 billion
- Industry: Food Products
- Analyst Upside: 13%
- P/E Ratio: 11
Company Overview: Kraft Heinz is a major player in packaged foods, with its iconic brands like Kraft, Heinz, Oscar Mayer, and Velveeta. Its portfolio covers condiments, cheese, meals, and beverages.
Business Strategy: After years of focusing on cost-cutting, Kraft Heinz is shifting gears to invest more in innovation, brand revitalization, and international markets. The goal is to breathe new life into its portfolio and position the company for sustainable, long-term growth.
Recent Developments:
- Earnings & Profitability: Kraft Heinz has been leaning on operational efficiencies and smart pricing moves to keep profitability steady in a challenging environment.
- Business Growth Trends: The company’s recent push into emerging markets and digital transformation is starting to show early signs of momentum.
- Shareholder Returns: While paying down debt remains a priority, Kraft Heinz continues to return cash to shareholders through a steady dividend.
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General Mills (GIS)
- Market Cap: $31 billion
- Industry: Food Products
- Analyst Upside: 11%
- P/E Ratio: 14.5
Company Overview:
General Mills has been a household name for generations, with beloved brands like Cheerios, Betty Crocker, Pillsbury, and Blue Buffalo. Its business spans retail grocery, foodservice, and a fast-growing pet food division, giving it a wide footprint across the food industry.
Business Strategy:
The company is working to keep its brands fresh and relevant by renovating its core products and reshaping its portfolio. With a strong focus on cost discipline and a growing push into pet food, General Mills is aiming to stay competitive and drive steady, long-term growth.
Recent Developments:
- Earnings & Profitability: General Mills has managed to protect its margins by staying disciplined on costs and using pricing power where it counts.
- Business Growth Trends: While some core U.S. categories have seen softer demand, the company is finding new momentum in pet food and international markets, helping to keep overall growth on track.
- Shareholder Returns: General Mills continues to deliver steady shareholder returns, with reliable dividends and buybacks when the opportunity looks right.
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TIKR Takeaway
PepsiCo (PEP), Kraft Heinz (KHC), and General Mills (GIS) appear to be undervalued consumer staples stocks today. These companies have resilient business models, broad brand portfolios, and a history of generating consistent cash flow, making them attractive options for long-term investors looking for defensive, low-risk stocks.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
