With President Trump’s new policies regarding tariffs taking place soon, concerns regarding inflation have spiked up. In such an uncertain environment, consumer staple stocks stand out, as they perform reliably even amid market fluctuations.
Amid this backdrop, fundamentally robust stocks, The Procter & Gamble Company (PG), The Coca-Cola Company (KO), and Colgate-Palmolive Company (CL) could be the perfect options for investors looking for defensive investment options.
President Trump has issued a presidential decree to implement a 25% additional tariff on imports from Canada and Mexico and a 10% additional tariff on imports from China. The government plans to focus more on the country’s manufacturing sector, boosting job growth.
Moreover, the President imposed a 25% tariff on all steel and aluminum imports into the United States with no exceptions or exemptions. Even though the aim of these tariffs is to promote the country’s economy, the consumers have resorted to a state of uncertainty.
In response to this, U.S. consumers’ long-term inflation expectations edged higher in January. With long-term high inflation expectations, consumers tend to spend less and save more, resulting in reduced overall consumer spending.
In this volatile environment, consumer staples, which include essential items such as food, household goods, and personal care products, continue to offer stability during market fluctuations. Due to their inelastic demand, these products maintain steady sales despite price changes, making the consumer staples industry a potentially resilient investment choice.
Now, let us dive deep into the fundamentals of three consumer staples stocks, starting with #3.
Stock #3: The Procter & Gamble Company (PG)
PG provides branded consumer packaged goods. The company offers products under various brands, including Head & Shoulders, Herbal Essences, Tide, Olay, Old Spice, and others. It has five segments: Beauty; Grooming; Health Care; Fabric & Home Care; and Baby, Feminine & Family Care.
On February 6, 2025, PG announced the release of its new and innovative PLUG Scent Booster, a device that gives complete control over the home's scent. Compatible with over 30 Febreze PLUG refills, the new release could aid the company in enhancing its sales and boosting its topline growth.
For the fiscal 2025 third quarter that ended December 31, 2024, PG’s net sales increased 2.1% year-over-year to $21.88 billion. Its operating income rose 29.5% from the year-ago value to $5.74 billion. Additionally, net income attributable to PG and net earnings per common share grew 33.5% and 34.3% from the prior year’s quarter to $4.63 billion and $1.88, respectively.
Analysts expect PG’s revenue and EPS for the fiscal 2025 third quarter ending in March to increase 1.7% and 4% year-over-year to $20.54 billion and $1.58, respectively. The company has also surpassed the consensus EPS estimates in all four trailing quarters, which is noteworthy.
Shares of PG have surged 6.4% over the year to close the last trading session at $167.47.
PG’s POWR Ratings reflect its fundamentals. PG has an A grade for Stability and a B for Quality. The POWR Ratings are calculated by taking into account 118 different factors, with each factor weighted to an optimal degree.
Within the Consumer Goods industry, PG is ranked #30 out of 53 stocks. To access PG’s Value, Growth, Momentum, and Sentiment ratings, click here.
Stock #2: The Coca-Cola Company (KO)
KO is a beverage company that manufactures, markets, and sells various nonalcoholic beverages. It sells its products under Coca-Cola, Diet Coke/Coca-Cola Light, Coca-Cola Zero Sugar, Fanta Orange, Sprite, Sprite Zero Sugar, Schweppes, Thums Up, and other popular brands.
On December 19, 2024, KO announced an agreement to acquire Billson’s, an Australia-based brand of alcohol ready-to-drink products. The acquisition expands KO’s portfolio of cocktail-based products by including the company’s Vodka with Tangle, Vodka with Grape Burst, and Vodka with Portello. This could enhance the company’s sales figures.
For the fiscal 2024 third quarter that ended September 27, 2024, KO’s net operating revenues came in at $11.85 billion. Its operating income was reported to be $2.51 billion. Moreover, net income attributable to shareholders of KO and net income per share amounted to $2.85 billion and $0.66, respectively.
Street expects KO's EPS for the fiscal 2024 fourth quarter, which ended in December 2024, to increase 5.5% year-over-year to $0.52. Its EPS for the fiscal 2025 first quarter ending in March is forecasted to rise 1.3% year-over-year to $0.73. Moreover, the company has surpassed the consensus revenue and EPS estimates in all four trailing quarters, which is impressive.
Shares of KO have surged 5.6% over the past nine months and 12.1% over the past year to close the last trading session at $66.79.
KO's fundamentals are reelected in its POWR ratings. KO has a B grade for Stability, Sentiment, and Quality.
Within the B-rated Beverages industry, KO is ranked #16 out of 31 stocks. In addition to the POWR Rating highlighted above, you can check KO’s ratings for Momentum, Growth, and Value here.
Stock #1: Colgate-Palmolive Company (CL)
CL manufactures and sells consumer products. The company markets and sells its products under various brands, including Colgate, Darlie, elmex, hello, meridol, Sorriso, Tom's of Maine, Irish Spring, Palmolive, Protex, and more. It has two segments: Oral, Personal, and Home Care and Pet Nutrition.
For the fiscal 2024 fourth quarter that ended December 31, 2024, CL’s net sales amounted to $4.94 billion. Its non-GAAP operating profit came in at $1.07 billion. Additionally, non-GAAP net income attributable to CL and non-GAAP EPS increased 3.5% and 4.6% year-over-year to $745 million and $0.91, respectively.
The company also expressed its yearly guidance for the full fiscal year 2025. CL expects a 3% to 5% growth in its organic sales. It also expects gross profit margin expansion to go up slightly on both a dollar basis and as a percent of sales and mid-single-digit earnings-per-share growth.
The consensus EPS estimate of $0.88 for the fiscal 2025 first quarter ending in March reflects a year-over-year rise of 2.8%. Additionally, its EPS for the fiscal 2025 second quarter ending in June is expected to grow 3.3% year-over-year to $0.94. The company has surpassed the consensus EPS estimates in all of the four trailing quarters, which is impressive.
CL’s shares have surged 3.6% over the past year, ending the last trading session at $85.50.
CL’s POWR ratings reflect its fundamentals. CL has an A grade for Quality and a B for Stability.
Within the Consumer Goods industry, CL is ranked #22 out of 53 stocks. Click here to access CL’s Value, Growth, Momentum, and Sentiment ratings.
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PG shares were trading at $167.58 per share on Tuesday morning, up $0.05 (+0.03%). Year-to-date, PG has gained 0.57%, versus a 3.20% rise in the benchmark S&P 500 index during the same period.
About the Author: Aritra_Gangopadhyay
Aritra is a financial journalist dedicated to breaking down complex financial topics into simple, actionable insights. Holding a Master’s degree in Economics, he uses his analytical expertise to help investors uncover unique opportunities for long-term success.
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