Are These The Best Consumer Stocks To Buy Now?
With all the focus on supply chains, inflation, and the upcoming holiday season, consumer stocks remain as relevant as ever. After all, this vast part of the stock market has and continues to cater to the general public overall. Whether it is entertainment, travel, or even retail, this is evident. Additionally, there is also a strong momentum in consumer spending trends to consider now. Recall September’s retail sales growth of 0.7% posted last week. This completely smashed Dow Jones economists’ estimates of a 0.2% decline, suggesting robust demand among consumers. As such, some would argue that consumer industry giants could likely adapt to supply issues to produce impressive quarterly figures.
For example, we could look at consumer health company Johnson & Johnson (NYSE: JNJ). Earlier today, JNJ reported solid figures in its third fiscal quarter earnings call. Notably, the company posted an earnings per share of $2.60 on revenue of $23.34 billion. While falling just short of estimates on revenue, JNJ exceeded expectations in terms of earnings per share, beating projections of $2.35. At the same time, fintech firm Coinbase (NASDAQ: COIN) is now teaming up with social media giant Facebook (NASDAQ: FB). Through this partnership, Facebook will be working with Coinbase to roll out Novi, its new digital wallet. All in all, the consumer market remains as active as ever. On that note, here are four top consumer stocks to consider in the market now.
Best Consumer Stocks To Consider Buying [Or Selling] Today
- Procter & Gamble Company (NYSE: PG)
- Walmart Inc. (NYSE: WMT)
- Philip Morris International (NYSE: PM)
- Airbnb Inc. (NASDAQ: ABNB)
Procter & Gamble Company
First on this list of consumer stocks, we have Procter & Gamble. The company serves consumers around the world with its portfolio of everyday items. Its products are divided into 10 categories and are part of its strategy to only focus on developing these daily-use products. This would include personal health care and home care products. The company also emphasizes on productivity, driving cost savings and efficiency improvements in every aspect of its business.
Earlier today, the company announced its first-quarter financials for the fiscal year 2022. Diving in, net sales for the quarter reached a whopping $20.3 billion, a 5% increase compared to the year prior. Net income for the quarter was $4.12 billion or a diluted earnings per share of $1.61. Procter & Gamble also returned $5 billion of cash to shareholders through dividend payments and common stock repurchases. This volume increase in sales was driven by strong consumer demand for its product and is also partially offset by a high base period in some markets due to the rebuilding of inventories by suppliers. Given the solid financials, should investors consider adding PG stock to their portfolios?
Walmart is a multinational retail corporation that operates a chain of hypermarkets, discount department stores, and grocery stores. The company claims that over 200 million customers and members visit its approximately 10,500 stores and clubs in 24 countries and also e-commerce websites. In its latest fiscal year reporting, the company reported a revenue of $559 billion. It also employs over 2 million associates worldwide.
Today, Goldman Sachs (NYSE: GS) said that it is positive on the company ahead of its earnings report, adding the stock to its high-profile conviction buy list. Notably, the firm thinks that the major investments made by Walmart over the last few years will pay off with strong results.
Analyst Kate McShane said that by investing in e-commerce and its supply chain, the company is now in a position to grow EBIT dollars along with continued investments due to the greater scale of its e-commerce business today. She also said that Walmart’s massive scale should give it a leg up on other retailers as the U.S. economy continues to go through various supply chain-related issues in relation to the pandemic. With that being said, is WMT stock worth buying right now?
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Philip Morris International Inc.
Philip Morris International is a multinational cigarette and tobacco manufacturing company. Its products are sold in over 180 countries and its most recognized and best-selling product is Marlboro. Despite being known for its cigarette products, the company is currently in the midst of transforming the tobacco industry to create a smoke-free future and ultimately replacing cigarettes with smoke-free products to the benefit of adults. Through its multidisciplinary capabilities in product development and state-of-the-art facilities, Philip Morris strives to meet its consumer preferences and rigorous regulatory requirements.
The company also reported its financials today. Impressively, net revenues for the quarter were $8.12 billion, increasing by 9.1% year-over-year. The company also reported an adjusted diluted earnings per share of $1.58 for the quarter.
“Our business delivered another strong quarterly performance, coming ahead of our expectations with adjusted diluted EPS of $1.58, representing growth of 8.5%, excluding currency,” said Jacek Olczak, Chief Executive Officer. “Today, we are reaffirming our strong growth outlook for 2021, with an adjusted diluted EPS forecast toward the upper-half of our previous range and representing currency-neutral growth of 13% to 14%, despite ongoing tightness in device supplies due to the global shortage of semiconductors, which impacts our ability to fulfill consumer demand for IQOS.” For these reasons, is PM stock a buy?
Last but not least, we will be taking a look at Airbnb. For the most part, Airbnb remains the go-to for those looking to make vacation rentals. Through its proprietary online marketplace, the company connects travelers with a wide array of travel solutions. This mostly includes lodging, homestays, and tourism-related activities. Now, as more of the general population get fully vaccinated or receive booster shots, domestic travel continues to rise. As such, travel stocks such as ABNB could be worth keeping an eye on in the current market.
Even at its current value, analysts appear to see further growth down the line for ABNB stock. Namely, Cowen (NASDAQ: COWN) analyst Kevin Kopelman recently provided a positive update on Airbnb. In detail, Kopelman hit ABNB stock with an Outperform rating and a price target of $220, suggesting a potential upside of 28% from its current price point. The analyst cited Airbnb’s leading position in the “alternative lodging” industry as a potential growth driver for the firm. All things considered, should you invest in ABNB stock?