Best Consumer Staples Stocks To Buy In May

Key Insights

• S&P 500 is testing yearly lows, so traders are focused on finding safe-haven assets in the current market environment. 
• Consumer staples stocks have enjoyed strong support this year. 
• The stocks in this market segment are trading at reasonable valuation levels. 

S&P 500 remains under strong pressure and is testing the 4000 level, so traders continue to search for safe-haven assets that could protect them from the broad market sell-off. Consumer staples stocks have outperformed the market in 2022, and it looks that demand for such stocks would remain stable.

Walmart

Walmart has recently pulled back from its all-time highs levels, which is not surprising given the broader market performance.

Analysts expect that Walmart will report earnings of $6.77 per share in the current fiscal year and earnings of $7.27 per share in the next fiscal year, so the stock is trading at roughly 21 forward P/E.

This is not too cheap, but companies like Walmart have a good position in the inflationary environment. Not surprisingly, investors’ demand for the company’s shares remained strong in 2022, and Walmart stock is up by roughly 5% year-to-date despite general market correction.

Kellogg

Kellogg stock has recently gained strong upside momentum and moved to new highs after the company released its quarterly report.

Kellogg reported revenue of $3.67 billion and adjusted earnings of $1.10 per share, beating analyst estimates on both earnings and revenue. Traders focused on the company’s ability to deal with supply chain problems and inflationary pressures.

Analysts estimates moved higher after the release of the report. Currently, the company is expected to report earnings of $4.11 per share in the current year and $4.3 per share in the next year, so the stock is trading at 18 forward P/E. Such valuation levels look reasonable at a time when traders are ready to buy shares of consumer staples companies that can deal with inflationary pressures.

For a look at all of today’s economic events, check out our economic calendar.