Consumer Staples Stocks To Watch As Inflation And Rates Stay In Focus

With Treasury yields climbing, oil prices reacting to fresh geopolitical tension, and the Federal Reserve back in the spotlight, many investors are rethinking which stocks feel resilient when inflation stays on the radar. Consumer staples are often seen as a potential anchor because people still need everyday essentials, even as borrowing costs and energy prices shift. This article looks at three large consumer staples stocks from an Inflation-Resilient Consumer Staples screener that appear closely tied to the latest macro news, which may help you assess whether they fit or do not fit your current approach to risk and income.

Elders (ASX:ELD)

Overview: Elders (ASX:ELD) is an Australian agribusiness that supplies farmers with essentials like seed, fertiliser, animal health products and advisory services, runs livestock and wool agencies and auctions, and offers rural real estate, banking and insurance, all tied into the country’s food and fibre supply chain.

Operations: Elders generates about A$3.6b in revenue from its agricultural and related services operations, all reported within Australia.

Market Cap: A$1.2b

Investors watching inflation and rate moves may find Elders worth a closer look because it sits at the heart of food production, yet carries a mix of appealing income and real risks. The stock trades at a large discount to one fair value estimate while also on a relatively high P/E, which hints at a debate over earnings quality. Forecast earnings growth around 18.1% contrasts with weak recent margins and a leverage ratio of 3.8x, so progress on debt reduction is crucial. A fully franked dividend yield above 6% is attractive, but coverage is thin, especially after a one off A$37.8m loss, leaving investors to weigh income and potential upside against balance sheet pressure and board turnover.

Elders looks like an earnings story that has not fully clicked with the market yet, with growth forecasts, a high P/E and that big one off loss all pulling in different directions. The 2 key rewards and 3 important warning signs could be the missing context investors are overlooking right now.

PZ Cussons (LSE:PZC)

Overview: PZ Cussons (LSE:PZC) is a consumer goods company that manufactures and sells everyday essentials such as baby care, beauty, hygiene, household cleaning and cooking oil products across the U.K., Europe, Africa, Asia Pacific and the Americas under brands like Carex, Cussons Baby, Imperial Leather, Morning Fresh and St. Tropez.

Operations: PZ Cussons generates about £533.8m in revenue, led by Europe & The Americas (£203.3m) and Asia Pacific (£175.8m), with Africa contributing £159.4m and Central operations £43.6m, partly offset by £48.3m of eliminations.

Market Cap: £432.1m

PZ Cussons sits neatly in the consumer staples camp at a time when investors are watching inflation, rates and oil prices. It offers products households tend to keep buying even when budgets are tight. The stock screens as attractively valued, with a low P/S ratio relative to peers and a price below one DCF-based estimate. Management is working to turn a current loss into profit over the next few years. Exposure to Nigeria and other emerging markets brings currency and inflation risk, and the dividend is not well covered by earnings or free cash flow, so income seekers may tread carefully. For investors willing to back a potential turnaround in a core everyday goods business, PZ Cussons is an interesting case to study further.

PZ Cussons looks like a turnaround story hiding in plain sight, with everyday brands, a low P/S and a plan to move from loss back to profit, so the 3 key rewards and 1 important major warning sign could reveal what is quietly reshaping the story

Select Harvests (ASX:SHV)

Overview: Select Harvests (ASX:SHV) is one of Australia’s largest almond growers, processing and packaging almonds from its orchards into products like blanched, roasted, sliced and paste for food and beverage customers at home and across Asia, Europe and the Middle East.

Operations: Select Harvests generates A$352.8m in revenue from its almond business in Australia.

Market Cap: A$535.1m

Select Harvests gives you exposure to a staple food ingredient at a time when inflation, higher yields and firm commodity input costs are back in focus. The company operates an integrated almond platform, and profit depends heavily on achieved almond prices and crop quality. Recent results show softer sales and some margin pressure as costs like water, bees and electricity are rising. With the stock trading below one fair value estimate and a buyback and dividends returning cash to shareholders, investors may wish to weigh any perceived value gap against weather risk, global pricing swings and a fully debt funded balance sheet.

With Select Harvests, the tension between a fully debt funded balance sheet and a stock sitting below one fair value estimate is hard to ignore, so the Select Harvests financial health report could reveal what is really driving that gap.

The three stocks covered here are only a starting point, as the full Inflation-Resilient Consumer Staples screener surfaced 32 more consumer staples companies with equally compelling inflation-resilient narratives that you have not seen yet. Use Simply Wall St to identify, filter and analyze the specific catalysts, balance sheet profiles, dividend characteristics and risk scores that matter most to you, so you can focus on the ideas in this theme that you find most compelling.

Take Control of Your Investment Journey

If Select Harvests or any of these companies sound like a great opportunity, register for FREE with Simply Wall St and add your companies to a Watchlist to monitor the share price against the fair value the ideal entry point. Once you've made your move, manage your holdings with our Portfolio Command Center that filters out the noise to deliver only the most critical, actionable updates. Throughout your journey, our Community allows you to filter the best ideas from thousands of investor perspectives. By uncovering hidden catalysts and risks early, you'll accelerate your decision-making and stay one step ahead of the market.

Seeking Alternatives Before The Crowd?

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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