The Best Consumer Goods Stock to Hold in Uncertain Times
Key Points
The economy presently faces uncertainty.
Procter & Gamble's strong consumer staples brands should hold up better than discretionary items.
- 10 stocks we like better than Procter & Gamble ›
With the holiday season upon us, many people are in a festive mood. However, that shouldn't overshadow the angst that they feel about high prices and a weakening job market.
Keeping that in mind, you can hunt for stocks in the consumer goods sector that do well no matter what happens with the broad economy.
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Procter & Gamble (NYSE: PG) tops my list of stocks to buy during these uncertain times.
Image source: Getty Images.
Excelling in essentials
You may very well have Procter & Gamble products in your home right now. It sells everyday essentials like shampoo, razors, toothpaste, laundry detergent, and diapers.
Procter & Gamble's products aren't just run-of-the-mill, either. It sells these items under popular brands, including Head & Shoulders, Gillette, Crest, Tide, and Pampers. Procter & Gamble's products have high market shares.
Procter & Gamble's fiscal first-quarter sales grew 2% after removing foreign-currency translation effects and the effect of acquisitions and divestitures. The period ended on Sept. 30. Management expects flat to 4% growth for the year.
While that's not great growth, Procter & Gamble isn't alone in feeling the effects of a weary consumer.
These consumer staples' companies typically don't see a dip in demand even during periods of economic stress. But I expect volume, which was flat in the latest quarter, to increase over time.
After all, people need these items, and they'll eventually return to their normal spending patterns. With its powerful brands, Procter & Gamble should benefit while consumer discretionary companies struggle.
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Lawrence Rothman, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
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