Three solid stock options for food businesses during an economic downturn, catering to conservative investors.
In today's economic climate, many portfolios are taking a hit. Over the past few years, it's become common for private investors to include tech stocks, but these volatile investments have left quite a few people scratching their heads. To strike a balance, consider incorporating some more conservative stocks, particularly food stocks. These resilient investments, which provide everyday essentials to both consumers and businesses, are particularly valuable during recessions and periods of decreased consumer spending. Here are three food-related value stocks that are worth a look:
Hilton Food
Based in the UK, Hilton Food manufactures protein-rich products, with a focus on raw meat, poultry, fish, and vegetarian and vegan alternatives. Another interesting aspect is their dedicated sauce department that emerged from the company's fish division. On the stock market, the company is valued at 110 billion euros. With a P/E ratio of 16, it's considered one of the more attractively priced food manufacturers, though it's far from being a discount stock. True to form for a conservative value stock, it offers an appealing dividend yield of 3 percent.
Mondelez
Next up is Mondelez, an American chocolate manufacturer that produces and distributes well-known global brands, such as Milka, Oreo, and 7Days in Germany. The stock market has already discovered Mondelez's sweet potential, currently pricing the company at 20 times earnings. This results in a market capitalization of 89 billion euros and a dividend yield of 2.4 percent for investors.
Mowi
The final company on this list is Mowi, a Norwegian company specializing in the farming and global distribution of shrimp and salmon. While it may be unfamiliar to many, Mowi's products are likely already a part of your diet. Previously known as Marine Harvest until 2019, Mowi is currently valued at 12 billion euros on the stock market, making it the most affordable of the three featured companies. With a P/E ratio of 15, it offers the lowest valuation and a high dividend yield of 4.6 percent for investors.
When it comes to food-related value stocks, the consumer staples sector offers resilient choices with competitive yields. Examples include Altria (MO) and British American Tobacco (BTI), both of which offer high dividend yields through their addiction-based business models. Another option is Mondelez International (MDLZ), a snack food giant, or Archer-Daniels-Midland (ADM), which plays a significant role in agricultural supply chains. These food-related stocks provide a balanced approach and moderate yields compared to tobacco companies.
- Despite the economic climate causing a hit to many portfolios, considering conservative stocks like Hilton Food, a UK-based protein manufacturer valued at 110 billion euros and offering a dividend yield of 3 percent, can contribute to a balanced investment strategy.
- Mondelez, an American chocolate manufacturer with a market capitalization of 89 billion euros and a dividend yield of 2.4 percent, is an interesting pick among food-related value stocks, despite being priced at 20 times earnings.
- For the most affordable option among the listed companies, Mowi, a Norwegian shrimp and salmon farming company valued at 12 billion euros with a dividend yield of 4.6 percent, presents a significant choice within the consumer staples sector.
- In addition to the featured companies, other resilient food-related value stocks worthy of consideration include Altria and British American Tobacco, both offering high dividend yields through their addiction-based business models.
- Mondelez International, a snack food giant, and Archer-Daniels-Midland, which plays a significant role in agricultural supply chains, are other food-related stocks offering competitive yields compared to tobacco companies, but with less controversially sourced products.
- Integrating food stocks into personal-finance portfolios can offer a more stable investment option, providing everyday essentials that are in constant demand even during periods of recession and decreased consumer spending.
