Our Outlook for Consumer Defensive Stocks
We see continued margin pressures, emerging-market opportunities, spin-off acquisition targets, plus some pockets of value in the sector.
Quarter-End Insights
Mentioned: Reckitt Benckiser Group PLC (RKT)
, LVMH Moet Hennessy Louis Vuitton SE (MC)
, Pernod Ricard SA (RI)
, KKR & Co Inc (KKR)
, Fortune Brands Home & Security Inc (FBHS)
, Beam Inc (BEAM)
, Kellogg Co (K)
, Ralcorp Holdings, Inc. (RAH)
, PepsiCo Inc (PEP)
, Walmart Inc (WMT)
- Margins are likely to remain constrained as commodity cost pressures persist.
- A pronounced uptick in spending among developed-market consumers is likely several quarters off, but emerging markets provide an opportunity for growth.
- Spin-offs could also become acquisition targets in 2012.
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Erin Lash does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.