Are These The Best Consumer Consumer Staples Stocks To Today?
When most people think of the stock market, they think of high-growth tech stocks or big pharma. But there is another sector of the stock market that is often overlooked: consumer staples. So what are consumer staples, and why should investors pay attention to them? In this blog post, we’ll answer those questions and we’ll also look at some of the top consumer staples stocks in the stock market today.
What Are Consumer Staples?
Consumer staples are those items that are considered essential for everyday life. This includes food, clothing, shelter, and transportation. These items are typically not luxury items, but instead are necessary for survival. While the exact definition of consumer staples may vary from culture to culture, there are some items that are universally considered to be staples.
For example, in most cultures, food is an essential item, and therefore would be classified as a consumer staple. Consumer staples are typically those items that people cannot live without, and as a result, they tend to be in high demand. This high demand can often lead to stable prices for these items, even when other goods and services are experiencing inflationary pressures. As a result, investing in consumer staples stocks can often be a wise choice for investors looking for stability in their portfolios.
Why Consumer Staples Stocks?
We know now that consumer staples stocks are those of companies that provide essential goods and services to consumers. These can include food, beverage, and household product companies, as well as retailers and grocery stores. In the stock market, some of the more notable consumer staples companies are names like The Coca-Cola Company (NYSE: KO) and General Mills Inc. (NYSE: GIS). Additionally, consumer staples stocks tend to be less volatile than other types of stocks, as people continue to need these goods and services even during economic downturns. This makes them an attractive investment for risk-averse investors.
Moreover, consumer staples companies usually have strong brand loyalty, which can lead to stable or even growing profits over time. For these reasons, consumer Staples stocks can be a good addition to any portfolio. Given this, if you’re keen on investing in consumer staples stocks right now, here are three to watch in September 2022.
Consumer Staples Stocks To Watch Now
- Walgreens Boots Alliance (NASDAQ: WBA)
- PepsiCo Inc. (NASDAQ: PEP)
- Walmart Inc. (NYSE: WMT)
Walgreens Boots Alliance (WBA Stock)
First up, Walgreens Boots Alliance (WBA) is a pharmacy-led health and wellbeing company. The company focuses on filling prescriptions, health and wellness products, health information, and photo services. For a sense of scale, WBA has approximately 13,000 locations United States, Europe, and Latin America. Meanwhile, the company has more than 315,000 team members in nine countries worldwide.
In late June, Walgreens Boots Alliance (WBA) announced its Q3 2022 financial results. In the report, WBA posted earnings of $0.96. with revenue of $32.6 billion. This was versus analysts’ consensus estimates for the quarter of $0.95 earnings per share and revenue of $32.0 billion. What’s more, on Wednesday, Walgreens announced it has completed its majority share acquisition of CareCentrix. In brief, CareCentrix, Inc. is an independent home-centered platform that coordinates care to the home for health plans, providers & patients. In detail, the company invested nearly $330 million for 55% of CareCentrix. Currently, CareCentrix manages care for 19 million members through an estimated 7,400 provider locations.
Roz Brewer, CEO of Walgreens Boots Alliance commented in the press release, “We created Walgreens Health to reimagine local healthcare and wellbeing for all. This partnership advances our ability to address the needs of people across care settings immediately following hospital discharge. Our collaboration with CareCentrix is one of the many ways we are expanding on our pharmacy and patient expertise to surround individuals with care when and how they need it.” Moving along, as of Wednesday’s closing bell shares of WBA are trading at $35.06. Given their recent news announcements, should you add WBA to your list of consumer staples stocks to watch?
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PepsiCo (PEP Stock)
Next, PepsiCo Inc. (PEP) is a food, snack, and beverage company. The company has interests in the manufacturing, marketing, and distribution of grain-based snack foods, beverages, and other products. As it stands, the company has an annual dividend yield of 2.67%. Furthermore, in July the company announced its more recent quarterly financial results.
Diving in, PEP posted better-than-expected second-quarter 2022 financial results. Specifically, the company notched in earnings per share of $1.86, with revenue of $20.2 billion. For context, wall street analysts’ consensus estimates for earnings and revenue were $1.73 per share and revenue of $19.5 billion. What’s more, PepsiCo said it continues to estimate 2022 earnings of approximately $6.63 per share, while now estimating revenue of approximately $85.83 billion.
In the last six months of trading action, PEP stock has recovered over 6% and closed Wednesday’s trading day at $172.27 a share. All in all, do you think PEP stock is a good consumer staples stock to add to your long-term portfolio right now?
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Walmart Inc. (WMT Stock)
Lastly, Walmart Inc. (WMT) is an American multinational retail company that operates a chain of hypermarkets, discount department stores, and grocery stores. Headquartered in Bentonville, Arkansas, the company is also one of the largest e-commerce retailers in the world. Currently, WMT has an annual dividend yield of 1.69%. Earlier this month, the retail giant reported a beat for its Q2 2022 financial results.
In detail, Walmart reported earnings per share of $1.77, on revenue of $152.9 billion. Meanwhile, the Street’s consensus estimates for both were earnings per share of $1.60, on $150.5 billion in revenue. Moreover, the company’s U.S. comp sales and e-commerce growth increased by 6.5%, and 12% respectively. What’s more, Walmart reported it estimates third-quarter earnings in the range of $1.29 to $1.32 per share and revenue of approximately $147.55 billion.
Doug McMillon, President & CEO at Walmart stated in his press release to shareholders, “We’re pleased to see more customers choosing Walmart during this inflationary period, and we’re working hard to support them as they prioritize their spending. The actions we’ve taken to improve inventory levels in the U.S., along with a heavier mix of sales in grocery put pressure on profit margin for Q2 and our outlook for the year.” With that, as of Wednesday’s closing bell, shares of WMT stock are trading at $132.55 per share. Is now the time to buy WMT stock?
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