Consumer Staples Stocks Offer Inflation-Resistant Haven

Investors are seeking refuge from inflationary pressures in consumer staples stocks. With an 82% chance of a September Federal Reserve rate hike, $100 Brent crude oil prices, and US gasoline at $4 per gallon, essential goods companies could benefit.

a2 Milk is one such company that has generated most of its revenue from China and Other Asia, with NZ$1.43b in sales. It offers premium pricing, potential for special dividends, and exposure to the Asian market. However, investors should consider a relatively rich P/E ratio and pressure on margins.

Elders is an Australian agribusiness that supplies farmers with essentials like seeds, fertilizers, and animal health products. With A$3.63b in revenue, primarily from its Australian operations, it provides a link to real-world food supply chains. Investors can look forward to a fully franked dividend yield around 5.4% and potential benefits from the Delta Agribusiness acquisition.

PepsiCo is a global food and beverage company with a wide range of snacks and drinks. It generates most of its revenue from PepsiCo Beverages North America at US$29.2b, with additional contributions from other regions. The company offers a history of dividends, but high leverage and softer North America volumes sit on the other side of the scale.