4 Consumer Staples Stocks Built to Outlast Any Market Downturn
The most successful investors are those who emphasize continual learning. There are always lessons that the stock market is teaching.
Just in the past decade, for instance, the S&P 500 index has experienced multiple drawdowns of greater than 10%. The takeaway is that volatility can’t be avoided; it’s just a part of how things work.
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Investors might now be more aware of these swings, which could become more pronounced due to the rapidly evolving economy. As a result, maybe it’s time to find companies that can withstand the pressure, especially now that artificial intelligence (AI) has everyone worried.
Here are four consumer staples businesses that are built to handle any downturn. Their stable operations can boost the safety of a portfolio, although they aren’t necessarily going to put up robust investment gains that can beat the market.
Image source: Getty Images.
Coca-Cola(NYSE: KO) has a presence in virtually all corners of the globe, with its more than 200 beverage varieties. An estimated 2.2 billion servings of its products are consumed every day.
This business stands out thanks to its powerful brand, durable demand even in recessionary times, and incredible earnings power. Coca-Cola’s adjusted operating margin in fiscal 2025 was a stellar 31.2%. Profitability like this supports management’s ability to fund dividend payouts that have risen in 64 straight years.
This stock isn’t known to be a market outperformer, producing a total return of 123% in the past 10 years (as of April 15). The S&P 500 index, by comparison, put up a total return of 300% during the same time.
Next on the list is Costco Wholesale(NASDAQ: COST). This huge warehouse club operator, with 924 locations around the world, specializes in extremely low prices. Consumers pay yearly memberships to shop there, which supports loyalty and repeat visits.
It seems that Costco is able to report growth in same-store sales (comps) no matter what’s going on with the economy. Whether it’s a health crisis, surging inflation, geopolitical tension, or general uncertainty, this company is the envy of its peers.
It’s impossible to be disappointed by Costco’s investment performance. In the past five years, the stock’s total return of 182% was more than double the S&P 500’s gain.
But the shares aren’t cheap today. With the price-to-earnings multiple (P/E) at 51.5, this is a company that the investment community might view too favorably.
Procter & Gamble(NYSE: PG) can outlast a market downturn by producing some of the most popular and essential items that people need in their daily lives. The list includes Tide laundry detergent, Head & Shoulders shampoo, and Crest toothpaste, among many others. Demand holds steady in any economy because these are goods that households can’t be without.
For example, revenue dipped by only 3.3% in fiscal 2009 during the Great Recession. And it increased in every quarter in calendar 2020 and 2021 during the pandemic.
With a trailing-decade total return of 127%, Procter & Gamble isn’t going to wow growth investors. But this company has paid a dividend in 136 straight years, a feat that highlights how much staying power it has.
And we end with the world’s biggest retailer, Walmart(NASDAQ: WMT), which generated $706 billion in net sales in fiscal 2026 (ended Jan. 31). It has 10,900 stores worldwide.
With its sprawling physical footprint and everyday low prices, Walmart is a top choice for consumers. Comps were up 4.5% in fiscal 2026. There’s no doubt that the company would dominate in a severe recession, while most of its competitors would struggle.
Returning capital to shareholders is a priority. The dividend yield of 0.79% isn’t impressive, but the business has increased its payout for 53 consecutive years.
And Walmart has been a huge winner recently, with its share price soaring 167% in the past five years. However, the current valuation is steep: The stock trades at a P/E of 45.7.
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Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale and Walmart. The Motley Fool has a disclosure policy.
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