- Cal-Maine Foods (CALM): A leading producer and distributor of eggs around the U.S., so higher prices work in its favor.
- Hostess Brands (TWNK): Cuts across all demographics when it comes to comfort foods in unsettled times.
- Tyson Foods (TSN): May see some shortages due to the avian flu outbreak but it has plenty of contract farmers all over the country.
- Tesla (TSLA): Continues to be the EV maker everyone wants to own.
- Skyline Champion (SKY): Has a host of manufactured housing and mobile home brands that are part of a new trend in living options for young and old.
- Vista Outdoor (VSTO): Has more than 40 brands under its management, from Camelbak to Bell and Redfield to Remington.
- Gildan (GIL): Operates a number of mid-market activewear brands that cover your feet to your head.
The markets remain skittish. But consumers are still spending money. That’s why this is a good time for select consumer stocks.
Now, these aren’t the big flashy brands. These are middle-market brands and companies that serve a broad amount of people with their products. This isn’t the time for premium products or status symbols.
Most of these companies provide solid products that are accessible to everyone. And given the fact it’s hard to tell where we’ll be by the end of the year, these are meat and potatoes companies that deliver quality products at a decent price.
Granted, they range from electric vehicle (EV) makers to snack food makers. But the point is to diversify in strategic segments rather than drilling down in just one.
The two poultry-based companies have been doing well despite the avian flu outbreak because they’re large enough to distribute their risk. And demand will remain high for their products.
Buy a couple or three of these consumer stocks, rather than sinking your capital into just one.
| CALM | Cal-Maine Foods | $57. |
| TWNK | Hostess Brands | $23.37 |
| TSN | Tyson Foods | $96.79 |
| TSLA | Tesla | $1,017.14 |
| SKY | Skyline Champion | $50.88 |
| VSTO | Vista Outdoor | $36.09 |
| GIL | Gildan | $36.14 |
Cal-Maine Foods (CALM)
When you think of eggs, generally the first thing that comes to mind is chickens. But what should also come to mind is corn and soybeans.
Why? Because corn and soybeans are the primary feed for chickens. And when their prices go up, the cost of feeding chickens goes up.
Now, add to that the recent outbreak of avian flu. That means few chickens laying eggs. But fewer chickens for Cal-Maine Foods (NASDAQ:CALM) to feed means lower food bills.
The company is in a complicated environment right now, and it’s doing well. CALM stock has gained nearly 52% year-to-date (YTD). Given its dominant position in the U.S. egg market, it should fare well since eggs are still a relatively cheap source of protein.
This stock has an “A” rating in my Portfolio Grader.
Hostess Brands (TWNK)
Twinkies, HoHos, Snoballs and Donettes. These are just some of the goodies that Hostess Brands (NASDAQ:TWNK) has been serving up since 1919.
Actually, a private equity firm bought the original Hostess brand in 2013, and by 2016 debuted it in a special purpose acquisition company (SPAC) deal. The current company also owns the Dolly Madison and Voortman brands as well.
And Hostess doesn’t just do confections — it also makes bread. However, the lion’s share of its revenue come from its sweeter lines of products. But these are the kind of items that resonate with people when times get confusing and tough. Comfort foods are winners, and TWNK stock represents some of the leading names in the business.
TWNK stock has gained almost 15% YTD, and that number should continue to climb as the summer wears on and kids go on break.
This stock has an “A” rating in my Portfolio Grader.
Tyson Foods (TSN)
Just like CALM, Tyson Foods (NYSE:TSN) may produce chickens, but it’s the inputs that matter. And with commodity prices high, it means there are pricing pressures on chicken.
For consumers, that means this relatively cheap protein isn’t going to be on sale all the time. And if commodity prices remain high, prices will start to rise as well. Also, the avian flu can work in Tyson’s favor since demand is high but supply is constrained.
And as the summer cookouts and community barbeques get underway, TSN stock is going to have the power of pricing well into the summer. Tyson is developing meatless options as well. That makes sense, since it has most of the grains and suppliers for meatless options and it’s less complicated than raising chickens. Meat alternatives also sell for premium prices.
TSN stock has gained about 10% YTD and has a 1.9% dividend on top of that.
This stock has an “A” rating in my Portfolio Grader.
Tesla (TSLA)
Tesla (NASDAQ:TSLA) isn’t the chicken of EV makers, it’s more the Kobe beef. While there’s a slew of new EV-wannabes out there, Tesla is the pioneer. It took on the big automakers and built an entire ecosystem to support its cars and customers.
Today, TSLA stock has a market capitalization of more than $1 trillion, but it has yet to produce 1 million cars in a year. That means its value is in its potential. The company continues to scale up its production facilities and has Gigafactories in all its major markets around the world. That means it can insulate itself from outside vendors’ supply chains for key components.
TSLA stock is the de-facto bellwether of the EV industry for now. And it continues to innovate. The stock is treading water right now and down 15% YTD. But given gas prices today, that may well change soon.
This stock has a “B” rating in my Portfolio Grader.
Skyline Champion (SKY)
We’re all well aware of housing costs these days. But with every peak market, there are always alternatives that come to the fore. And those options can become niche growth industries until the broader market shifts.
That’s where Skyline Champion (NYSE:SKY) finds itself these days. It’s a North American leader in manufactured and modular homes, park-model RVs and workforce housing. It’s been around for nearly 70 years.
The fact is, remote work has completely shifted how a variety of the workforce functions. You don’t need to be in an office in a city to get work done any longer — and rural property is less expensive. Putting a modular home on a lot is a very inexpensive way to become a homeowner while avoiding the pricing premiums on existing homes or new developments.
What’s more, new RV parks are becoming destination living spots as well. With the boom in RV road warriors during the pandemic, these parks have been reimagined to cater to a new generation of customers.
SKY stock is going to be a key beneficiary of these trends. Currently, it is down more than 34% YTD due to its link to the broader housing market. But it’s in great shape for a rebound in the coming quarters. Its longevity in the industry is proof of its ability to make the best of any situation.
This stock has a “B” rating in my Portfolio Grader.
Vista Outdoor (VSTO)
One thing the pandemic reignited with many people was an appreciation for the great outdoors. While we were all isolated, the outdoors became a place of solace and enjoyment. That feeling hasn’t gone away, and younger generations who grew up with their computer screens gained a new appreciation for outdoor activities.
That’s where Vista Outdoor (NASDAQ:VSTO) comes in, with 40 different outdoor brands. Many of them are hunting related – guns, clothing, accessories and ammunition – but it also has a number of brands that are familiar to hikers and bikers alike.
The one thing all its brands have in common is their focus on people getting outside and doing things. They are also accessible to all consumers, not high-end brands focused on an elite audience. That’s a key factor in being successful in an inflationary environment like this one.
VSTO stock has lost 25% YTD, but it’s well-positioned for strong gains as people go outside again in spring and summer.
This stock has a “B” rating in my Portfolio Grader.
Gildan (GIL)
How many t-shirts or sweatpants do you have around your house? It’s likely your inventory of comfy clothes grew during the pandemic. Now, relaxed clothes are ingrained in our lifestyle.
Gildan (NYSE:GIL) is a wholesaler and retailer of activewear, which includes sweats, shirts, leggings and socks. It has a handful of brands – including American Apparel – and does a lot of business wholesaling its products to other companies to brand with their own marks.
Casual, affordable clothes are part of the Gen Z and Millennial uniform, as the hoodie has replaced the power suit in many corporate offices. This trend isn’t going to change, since many in these demographics prefer to have a curated wardrobe of “nice” clothes and plenty of casual wear. This is a great advantage to Gildan moving forward.
GIL stock is down more than 16% YTD, but it’s well positioned for a rebound. It also has a 1.8% dividend.
This stock has a “B” rating in my Portfolio Grader.
On the date of publication, Louis Navellier has positions in SKY, VSTO, and GIL in this article. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.