Is it a good time to invest in consumer staples stocks?

It's impossible to predict the short-term movements of the market, but investors tend to favor consumer staples stocks during times of uncertainty since they generally outperform in weak economies due to their defensive positioning.

What is the average annual return of consumer staples?

Determining the average annual return of consumer staples depends on how you define the sector and which stocks you choose. Based on the history of the Consumer Staples Select Sector SPDR Fund (NYSEMKT: XLP), consumer staples stocks have compounded at a 7% rate with dividends reinvested since 1998.

What consumer staple stocks pay the most dividends?

Some of the best-paying consumer staples stocks are tobacco stocks. As of Sept. 2026, Altria paid a dividend yield of 6.5%, and British American Tobacco offered a 6.1% dividend yield.

Are consumer staples stocks recession-proof?

Consumer staples stocks tend to be recession-proof. They sell products that consumers buy regardless of the economic environment, like food, paper products, or cleaning supplies.

Should I invest in individual consumer staples stocks or ETFs?

If you want to invest in consumer staples stocks, but aren't sure which ones to choose, an ETF is a good option. The biggest ones hold the largest, best-known consumer staples stocks.

How should I track the performance of consumer staples stocks?

In addition to the performance of the stock itself, it's a good idea to track dividend growth, organic revenue growth, operating margin, and adjusted earnings per share growth.

Best Consumer Staples Stocks to Buy in 2026

Best Consumer Staples Stocks to Buy in 2026 and How to Invest in Them

By Jeremy Bowman – Updated Sep 11, 2026 at 5:03 PM EST | Fact-checked by Frank Bass

Key Points

Consumer staples stocks are defensive, offering stability in uncertain markets.
Top consumer staples include Procter & Gamble and PepsiCo, known for strong brands and dividends.
Costco stands out in the sector for its robust sales growth and unique business model.

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Top consumer staples stocks to consider

Top consumer staples include global giants like Procter & Gamble and Pepsico, which own everyday brands that have been household names for generations. Philip Morris International has been a longtime winner from the tobacco sector, an exemplar of the larger consumer staples sector, and Costco Wholesale, which shows that retailers can be consumer staples stocks and top performers as well.

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Ticker Information Table
Name and ticker	Market capMarket cap calculated using publicly traded shares outstanding only. Does not include unlisted, private, or dual-class non-traded shares. Implied market cap may vary.	Current price	Industry
Procter & Gamble (NYSE:PG)	$337.4 billion	$145.27	Household Products
PepsiCo (NASDAQ:PEP)	$186.1 billion	$136.32	Beverages
Philip Morris International (NYSE:PM)	$297.8 billion	$191.06	Tobacco
Costco Wholesale (NASDAQ:COST)	$401.2 billion	$904.77	Food and Staples Retailing

Data as of Sep 13, 2026. Showing 4 of 4 total entries.

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1. Procter & Gamble

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NYSE: PG

Procter & Gamble

Premium Feature

Moneyball Superscore

73/100

Today's Change

(1.61%) $2.30

Current Price

$145.27

Key Data Points

Market Cap

$337B

Day's Range

$143.55 - $145.49

52wk Range

$137.62 - $167.25

Volume

11.5M

Avg Vol

9.1M

Gross Margin

50.87%

Dividend Yield

2.95%

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Procter & Gamble (PG +1.61%) is best known for its marquee brands such as Tide, Gillette, and Crest. The household and personal care company is almost 200 years old. A large number of its brands hold the No. 1 or No. 2 market share position in their categories, including paper products, laundry detergent, diapers, and beauty products. P&G is also a Dividend King, meaning it's raised its dividend every year for 50 years in a row.

P&G has recently developed a number of innovative products, including the nontoxic insect repellent Zevo; a dye-free, silicone-free, and sulfate-free version of Head & Shoulders called Head & Shoulders BARE; and Spruce, a weed killer that cuts off the weed's water supply on contact. Spruce is P&G's first entry into the large lawn care category.

P&G has performed well during the recent inflationary era since it can pass along price increases to its customers, although its growth has slowed down recently. P&G finished its fiscal 2026, which ended on June 30, with 3%net sales growth and 1% organic sales growth. Core, or organic, earnings per share grew 1% to $6.89. The company expects sales growth of 1%-3% in fiscal 2027 and core EPS of $6.89-$7.11.

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2. PepsiCo

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NASDAQ: PEP

PepsiCo

Premium Feature

Moneyball Superscore

69/100

Today's Change

(-0.24%) $-0.33

Current Price

$136.32

Key Data Points

Market Cap

$186B

Day's Range

$136.04 - $137.49

52wk Range

$133.73 - $171.48

Volume

8.8M

Avg Vol

8.3M

Gross Margin

53.98%

Dividend Yield

4.26%

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PepsiCo (PEP -0.24%) is much more than its namesake beverage brand. Pepsi also owns Frito-Lay and Quaker, as well as popular drink brands such as Mountain Dew and Gatorade. Its Frito-Lay snack business generates almost as much revenue in North America as its beverages, and that business has historically been a source of growth while soda sales have slowed in the U.S. and around the world. More recently, the snack business has declined due to general health trends and the adoption of weight-loss drugs like Ozempic. With its global brands and distribution, Pepsi enjoys many of the same advantages as industry giants P&G and beverage company competitor Coca-Cola.

Because of its exposure to the restaurant industry, Pepsi is subject to demand in the consumer discretionary channel, but with the help of the strength of its brands, it's been able to capitalize on inflation by raising prices, though headwinds from tariffs and consumption trends have affected profits. In 2025, organic revenue rose 1.7%, though core constant-currency earnings per share (EPS) was flat. Through the first half of 2026, its growth has accelerated with organic volume up 1%, its fastest pace since 2022. That shows recent efforts to streamline the business are paying off.

Pepsi has also grown through acquisitions. In 2018, it acquired SodaStream, which gave the company a leading position in countertop soda-making. It also bought energy drink maker Rockstar Energy in 2020. In 2025, it acquired Siete Foods, a maker of grain-free tortillas and Mexican-American foods, and prebiotic soda brand Poppi.

PepsiCo recently became a Dividend King, having raised its quarterly payout for 50 years in a row, which shows that it’s an attractive stock for income investors. In Sept. 2026, it was offering a dividend yield of 4.3%.

3. Philip Morris

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NYSE: PM

Philip Morris International

Premium Feature

Moneyball Superscore

82/100

Today's Change

(0.68%) $1.29

Current Price

$191.06

Key Data Points

Market Cap

$298B

Day's Range

$190.56 - $194.82

52wk Range

$142.11 - $207.76

Volume

5.3M

Avg Vol

4.9M

Gross Margin

65.33%

Dividend Yield

3.08%

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Philip Morris (PM +0.68%) is one of the three global tobacco giants, but it has the strongest position among the three today. Philip Morris was formed when Altria (MO +0.28%) and Philip Morris split in 2008, with Altria retaining the domestic business, while Philip Morris took the international markets.

That's proven to favor Philip Morris since international tobacco markets have been much more resilient than the U.S., where smoking has been steadily declining for decades.

In addition to its exposure to more smoking-friendly markets, Philip Morris has also outperformed peers like Altria and British American Tobacco (BTI +0.69%) in next-gen, smoke-free products, which now make up more than 40% of Philip Morris' revenue and a higher percentage of its gross profit.

The company has found success with Iqos, its heat-not-burn tobacco sticks, which use tobacco rather than the e-liquid vapes use, and heat to a temperature where it turns into vapor rather than smoke. As of June 2025, there were 34 million Iqos users worldwide, and the number was growing. The company launched Iqos in the U.S. in March 2025.

Additionally, the company's acquisition of Swedish Match in 2023 has paid off, giving it ownership of the popular Zyn oral nicotine pouches, whose shipments jumped 36% to 13.6 billion cans in 2025, led by Zyn. Philip Morris is also expanding production at its Kentucky Zyn facility and adding a new one in Colorado.

Finally, Philip Morris offers a reliable dividend yield of 3.1%.

4. Costco Wholesale

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NASDAQ: COST

Costco Wholesale

Premium Feature

Moneyball Superscore

81/100

Today's Change

(0.27%) $2.39

Current Price

$904.77

Key Data Points

Market Cap

$401B

Day's Range

$900.75 - $907.36

52wk Range

$844.06 - $1096.50

Volume

1.8M

Avg Vol

2.2M

Gross Margin

12.88%

Dividend Yield

0.61%

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Costco Wholesale (COST +0.27%) has been one of the best-performing consumer staples stocks on the market in recent history.

Unlike the other stocks on the list, Costco doesn't make products for other retailers to sell. Instead, more than half of its sales come from groceries, a core consumer staples category.

Costco also has many of the components of a consumer staples stock that investors look for, including a stable business model built around its reputation for bargain prices on bulk goods. Its membership model adds another layer of resilience since most of its profits come from membership fees, and its customers are loyal, typically renewing memberships at a rate of around 90%. It also private-labels much of its merchandise with the Kirkland brand, helping to keep prices low and create a competitive advantage.

The retailer continues to open new stores and has delivered solid comparable sales and e-commerce growth. Comparable sales jumped 6.6% in fiscal 2026, excluding gas prices and currency exchange, an impressive number for a retailer of its size.

Costco also has a track record of rewarding investors with special dividends every three to five years, which makes up for its paltry dividend yield of 0.7%.

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How to buy consumer staples stocks

1. Open your brokerage account: Log in to your brokerage account where you handle your investments. If you don't have one yet, take a look at our favorite brokers and trading platforms to find the right one for you.
2. Search for consumer staples stocks: Enter the ticker into the search bar to bring up the stock's trading page.
3. Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
4. Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
5. Submit your order: Confirm the details and submit your buy order.
6. Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.

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Benefits and risks of consumer staples stocks

Consumer staples stocks have a number of benefits and risks for investors. Those include benefits like:

Consumer staples stocks are among the safest and most recession-proof stocks on the market. These companies sell products that consumers buy regardless of the economic environment, making them attractive, especially to risk-averse investors.
These tend to be timeless companies. Businesses like Coca-Cola (KO +0.52%), PepsiCo (PEP -0.24%), and Procter & Gamble (PG +1.61%) have been around for more than 100 years, showing their ability to withstand a variety of challenges and remain at the top of their industries.
Consumer staples stocks tend to be strong and reliable dividend payers. Many of them are Dividend Kings, or stocks that have raised their dividends every year for 50 years or more.
Consumer staples companies can be resilient in inflationary environments because they often have pricing power, enabling them to pass along price increases and negotiate with suppliers.
These companies have a long history of growing both organically and through acquisitions, helping them maintain dominance over their industries.

Below are some of the risks involved in consumer staples stocks:

Consumer staples stocks tend to be expensive relative to their growth rate. Because they are considered safe, they tend to trade at higher price-to-earnings (P/E) ratios than cyclical stocks, though this makes them more vulnerable to multiple compression, or a stock price falling because its valuation goes down.
Consumer staples companies tend to be slow-growth businesses. Typically, these companies won't deliver the kind of eye-popping returns you might find from a tech stock. If they outperform, it's generally through a combination of dividends and a stronger performance during bear markets.
Growth opportunities also tend to be limited because they generally compete in mature industries. The products that Procter & Gamble sells, like shampoo and razors, are well-established, and there is not much room for innovation.
Consumer trends can affect performance. For example, pressure on soda and tobacco has led some of those sector stocks to underperform in recent years.
Returns can be lower, especially during bull markets. Investors tend to rotate into high-growth stocks during bull markets, meaning consumer staples stocks may underperform.

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Methodology: How these stocks were chosen

Many of the top consumer staples stocks have been around for generations, some for more than 100 years. Over time, these brands have strengthened, expanded their distribution networks, and grown their product portfolios through organic innovation and acquisitions.

Procter & Gamble and Pepsico exemplify these characteristics. Philip Morris International has used similar strategies over its history, and the company has navigated the challenges to the tobacco industry well, through next-gen products like iQOS and Zyn. Finally, as a retailer, Costco employs a different business model from other consumer staples stocks, but it has benefited from classic consumer staples tactics, including selling fast-moving products like groceries and using them as traffic drivers to sell other higher-margin goods.

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Should you invest in consumer staples stocks?

There are a number of things to consider if you are thinking about investing in consumer staples stocks.

Consider your investing goals. If you're young and saving for retirement, you may prefer growth stocks over consumer staples. Consumer staples stocks are a good choice for investors looking for low-risk, defensive, dividend-paying stocks.
Remember that consumer staples tend to underperform in bull markets, so you will have to be patient with this sector.
Many consumer staples stocks have a long streak of raising their dividends, and some are even Dividend Kings, companies that have raised their dividends every year for 50 years straight. The sector is one of the most reliable for dividends.
While most consumer staples stocks are considered safe, it's a good idea to be aware of trends in subsectors such as pressure on soda or the impact of tariffs.
Investors generally choose consumer staples stocks for their income, safety, competitive advantages, and track record of performance.

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The bottom line

Consumer staples aren’t flashy, but they’re dependable. The best companies combine strong brands, global scale, and consistent cash flow -- qualities that tend to shine when markets get rocky.

For investors seeking stability and income, staples can play a valuable supporting role in a diversified portfolio.

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Investing in consumer staples stocks FAQ

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About the Author

Jeremy Bowman has been a contributing Motley Fool stock market analyst, covering technology, consumer goods, and macroeconomic trends since 2011. Before The Motley Fool, Jeremy was a newspaper reporter, restaurant manager, and English teacher abroad. He holds a bachelor’s degree in English from Colorado College and a master’s degree in business administration from American University. One of his Motley Fool headlines was briefly featured on Late Night with Stephen Colbert.

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Jeremy Bowman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool recommends British American Tobacco P.l.c. and Philip Morris International. The Motley Fool has a disclosure policy.

Best Consumer Staples Stocks to Buy in 2026 and How to Invest in Them

Key Points