2022 Consumer Staples Stocks List | Updated Daily | The 7 Best Now

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2022 Consumer Staples Stocks List | Updated Daily | The 7 Best Now


Data updated daily
Constituents updated annually

The consumer staples sector is home to some of the most well-known dividend growth stocks in the world.

There is also a wide body of evidence that suggests that the consumer staples sector outperforms over long periods of time.

With that in mind, we’ve compiled a database of all consumer staples stocks, which you can access below:

 

The list of stocks was derived from a few major consumer staples ETFs:

  1. Consumer Staples Select Sector SPDR ETF (XLP)
  2. Invesco Dynamic Food & Beverage ETF (PBJ)
  3. Invesco S&P Small Cap Consumer Staples ETF (PSCC)

Keep reading this article to learn more about the merits of investing in consumer staples stocks.

Table of Contents

This article provides our full list of all consumer staples stocks, a tutorial on how to use the spreadsheets to create screens of consumer staples stocks, and the top 7 consumer staples stocks now.

The top 7 list was derived from the expected returns of each stock. We calculate expected returns based on a projection of earnings-per-share growth, dividend yields, and changes in the valuation multiple. The 7 consumer staples stocks are ranked by 5-year expected returns, from lowest to highest.

The table of contents below allows for easy navigation:

How To Use The Consumer Staples Stocks List To Find Investment Ideas

Having an Excel document containing each dividend-paying consumer staples stocks is very useful.

This tool becomes even more potent when combined with a solid, fundamental knowledge of how to manipulate data with Microsoft Excel. Quantitative investing screeners allow investors to remove many of the cognitive biases that impair long-term investing returns.

With that in mind, this section will provide a step-by-step explanation of how to use the dividend-paying consumer staples stocks list to find the best consumer staples investment ideas by using simple screening techniques.

The first screen that we will implement is for stocks with price-to-earnings ratios below 25,

Screen 1: Avoiding Overvalued Stocks

Step 1: Download your free spreadsheet of all 71 consumer staples stocks here.

Step 2: Click on the filter icon at the top of the price-to-earnings ratio column, as shown below.

Consumer Staples Dividend Stocks Excel Tutorial 1

Step 3: Change the filter setting to “Less Than” and input 25 into the field beside it, as shown below.

Consumer Staples Dividend Stocks Excel Tutorial 2

The remaining stocks in the spreadsheet are consumer staples with price-to-earnings ratio less than 25.

The next screen that we’ll implement is for ‘blue chip stocks’ – those with dividend yields above 3% and market capitalizations above $10 billion.

Screen 2: Blue Chip Stocks

Step 1:Download your free spreadsheet of all 71 consumer staples stocks here.

Step 2: We’ll first filter by dividend yield and then by market capitalization. Importantly, order doesn’t matter – you could also filter by market capitalization and then dividend yield and the screen would output the same results.

To filter by dividend yield, click the filter icon at the top of the dividend yield icon, as shown above.

Consumer Staples Dividend Stocks Excel Tutorial 3 \

Step 3: To filter for dividend yields greater than 3%, change the filter setting to ‘Greater Than’, and input 0.03 into the field beside it.

Consumer Staples Dividend Stocks Excel Tutorial 4

Step 4: Next we’ll execute the screen for market capitalization. Close of out of the previous window (by clicking exit, not by clicking ‘clear filter’ at the bottom of the filter window). Then, click the filter icon at the top of the market capitalization column, as shown below.

Consumer Staples Stocks Corrected Excel Tutorial

Step 5: Change the filter setting to ‘Greater Than’ and input 10000 into the field beside it. Notice that since market capitalization is measured in millions of dollars in this spreadsheet, then filtering for stocks with market capitalizations above ‘$10,000 million’ is equivalent for screening for securities with market capitalizations above $10 billion.

Consumer Staples Dividend Stocks Excel Tutorial 6

The remaining stocks in this spreadsheet are those with dividend yields above 3% and market capitalizations above $10 billion.

You now have a solid understanding of how to use the dividend-paying consumer staples stocks spreadsheet to find compelling investment ideas. The next section will provide a summary of why the consumer staples sector merits an allocation in your investment portfolio.

Why Invest In Consumer Staples Stocks?

Consumer staples stocks are an appealing investment category for a number of reasons.

First of all, consumer staples stocks are very recession-resistant by definition. Consumer staples companies make products or deliver services that are considered to be ‘staples’ – in other words, consumers can’t do without them.

Food stocks within the consumer staples sector are an excellent example of this.  Consumers are likely to buy more food products during recessions as they cut back on dining out to conserve funds during difficult economic times.

Alcohol stocks are another example.  People tend to drink at least the same amount (if not more) when times get tough.

This means that consumer staples stocks tend to hold up very well during periods of economic turmoil. This can be seen by studying the sector’s performance during the 2007-2009 financial crisis.

During 2008, for example, the consumer staples sector returned -15%. While this seems bad on the surface, it is actually very good on a relative basis. Here’s the performance of some other sectors during the same calendar year:

Clearly, the performance of the consumer staples sector beat these other industries by a wide margin despite being negative itself. In fact, consumer staples was the single best performing sector during calendar year 2008.

The consumer staples sector stands up well during times of recessions, implying that the sector presents less risk than many of its counterparts.

Amazingly, the sector’s long-term performance has also been one of the best. The sector has demonstrated a remarkable ability to generate consistently high returns on invested capital, avoiding the mean reversion experienced by many other highly profitable industries.

While traditional academic theory tells us that investors must assume extra risk to generate incremental returns, the outperformance of the recession-resistant consumer staples sector tells us that this isn’t true in practice. The sector’s combination of high returns and low risk make it a uniquely appealing sector for conservative total return investors.

Consumer Staples Stock #7: Walmart Inc. (WMT)

Walmart traces its roots back to 1945 when Sam Walton opened his first discount store. The company has since grown into the largest retailer in the world, serving around 230 million customers each week. Revenue will be around $565 billion this year.

With over 40 consecutive years of dividend increases, Walmart is on the Dividend Aristocrats list. The company performed well in 2021 due to the economic recovery from the coronavirus pandemic.

Walmart also performed well on a two-year rolling basis.

Source: Investor Presentation

Walmart reported third quarter earnings on November 16th, 2021, and results were better than expected for both the top and adjusted bottom lines. Total revenue was up 4.3% to $141 billion, powered by comparable sales of +9.9% in the US. That beat consensus estimates for a gain of 6.9%, as transaction count rose 5.7%, and the average ticket was higher by 3.3%.

E-commerce sales were up 8% during the quarter and were 87% higher than the same quarter of 2019. Sam’s Club sales were up 13.9% while membership income rose 11.3%

We expect annual returns of 8.9% per year, due to a combination of EPS growth (5%), dividends (1.6%), and a small gain from an expanding P/E multiple.

Click here to download our most recent Sure Analysis report on Walmart (preview of page 1 of 3 shown below):

Consumer Staples Stock #6: Philip Morris International (PM))

Philip Morris International is a tobacco company that came into being when its parent company Altria (MO) spun off its international operations. Philip Morris sells cigarettes under the Marlboro brand, among others, internationally.

In the 2021 third quarter, the company reported net revenue of $8.12 billion, 9.0% higher compared to Q32020. Shipment volume was up 2.1% collectively, with cigarette shipment volume down 0.4% and heated tobacco, a much smaller portion of the business, up 23.8% yearoveryear. Adjusted earningspershare equaled $1.58 compared to $1.42 in the comparable period last year.

We expect Philip Morris International to grow its EPS by 3% per year over the next five years. Shares are fairly valued right now, meaning a changing P/E multiple is not expected to impact returns.

With a high dividend yield of 5.5%, total expected returns are estimated at 9.2% per year.

Click here to download our most recent Sure Analysis report on Philip Morris International (preview of page 1 of 3 shown below):

Consumer Staples Stock #5: Unilever plc (UL)

Unilever is one of the largest consumer goods companies in the world, producing and marketing ~400 brands in nearly 200 countries.

Wellknown brands include Ben & Jerry’s, Qtips, Suave, Vaseline, Axe, Dove, Hellmann’s, Knorr and many more. Its products are used by more than 2 billion people every day.

Source: Investor Presentation

In late October, Unilever reported (10/21/21) sales for the third quarter of fiscal year 2021. The company grew its underlying sales by 2.5% over last year’s quarter, as 4.1% growth from price hikes was partly offset by a -1.5% decrease in volumes. E-commerce grew 38% and now comprises 12% of total sales.

We expect annual returns of 9.5% through 2026, due to 5% expected EPS growth, the ~3.5% dividend yield, and a small boost from a rising P/E multiple.

Click here to download our most recent Sure Analysis report on Unilever plc (preview of page 1 of 3 shown below):

Consumer Staples Stock #4: Keurig Dr. Pepper (KDP)

Keurig Dr. Pepper (KDP) is the result of a ~$20B merger between Dr. Pepper Snapple (DPS) and Keurig Green Mountain completed in mid2018. The new company started trading on July 10, 2018. KDP is now the third largest nonalcoholic beverage company in terms of revenue in the U.S. behind CocaCola (KO) and Pepsi (PEP).

The company has generated strong growth in the past several years.

Source: Investor Presentation

KDP reports four business segments: Coffee Systems, Packaged Beverages, Beverage Concentrates and Latin America Beverages. Major brands include Core, Dr. Pepper, Sunkist, Canada Dry, Bai, 7UP, Snapple, and Keurig. KDP had net sales of about $11.62B in fiscal 2020.

We expect annual returns of nearly 10% per year, due mostly to 10% expected EPS growth. We view the stock as overvalued, with the negative return from a declining P/E multiple essentially offsetting the current dividend yield.

Click here to download our most recent Sure Analysis report on Keurig Dr. Pepper (preview of page 1 of 3 shown below):

Consumer Staples Stock #3: Archer-Daniels-Midland (ADM)

ArcherDanielsMidland is the largest publicly traded farmland product company in the United States. The company‘s businesses include the processing of cereal grains and oilseeds and agricultural storage and transportation.

The company reported strong third-quarter earnings results. Adjusted earnings per share of $0.97 increased 9% year-over-year. Revenue increased 34% for the quarter.

ADM stock trades for a P/E ratio of 12.5, below our fair value estimate of 15. In addition, we expect 6% annual EPS growth while the stock has a 2.3% dividend yield.

Total returns are expected to reach 11.5% per year over the next five years.

Click here to download our most recent Sure Analysis report on ADM (preview of page 1 of 3 shown below):

Consumer Staples Stock #2: Altria Group (MO)

Altria Group was founded by Philip Morris in 1847. Today, it is a consumer staples giant. It sells the Marlboro cigarette brand in the U.S. and a number of other nonsmokeable brands, including Skoal and Copenhagen.

Altria also has a 10% ownership stake in global beer giant Anheuser Busch Inbev, in addition to large stakes in Juul, a vaping products manufacturer and distributor, as well as cannabis company Cronos Group (CRON).

Marlboro remains Altria’s flagship product, with over 40% retail market share in the United States.

Source: Investor Presentation

We expect annual returns of 12% per year for Altria, comprised of the 8.3% dividend yield, 2.2% expected EPS growth, and a small boost from a rising P/E multiple.

Click here to download our most recent Sure Analysis report on Altria Group (preview of page 1 of 3 shown below):

Consumer Staples Stock #1: British American Tobacco (BTI)

British American Tobacco is one of the world’s largest tobacco companies. British American Tobacco owns many tobacco brands, including Kool, Benson & Hedges, Dunhill, Kent, and Lucky Strike.

The company also acquired the remaining 48% stake in Reynolds American Tobacco that it did not already own in July of 2017.

BTI’s future growth will be fueled by new products, such as e-vapor.

Source: Investor Presentation

We expect annual returns above 12%, due to the 8%+ dividend yield, EPS growth of 3% per year, and a small boost from a rising P/E multiple.

Click here to download our most recent Sure Analysis report on British American Tobacco (preview of page 1 of 3 shown below):

Final Thoughts

The consumer staples sector is an intriguing place to looks for high-quality dividend investment ideas.

If you’re willing to look outside of this sector while hunting for investment opportunities, the following stock databases are highly useful:

Investing is a unique craft because we have the ability to ‘cheat’ off the moves of the world’s greatest investors.

Large, institutional investment managers with more than $100 million in assets under management are required to disclose their portfolio holdings on a quarterly basis through a regulatory filing called a 13F.

With this in mind, there is no better investor than Berkshire Hathaway’s Warren Buffett. We provide a detailed quarterly analysis on Warren Buffett’s stock portfolio, which you can access below:

If you’re looking for other sector-specific dividend stocks, the following Sure Dividend databases will be useful:

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