Regardless of the economy, consumer products stocks profit from continual customer demand. Learn more and find one of our recommendations here.

Consumer products stocks benefit from continuous, habitual use and have a steady core of sales, regardless of the economy and business cycles. Typically, consumer-products companies sell staples, like soap, soup and beverages. These are items that consumers typically must buy no matter what the economy is doing.

As a result, the consumer sector can provide some protection against economic downturns. That’s a key difference between Consumer stocks and companies in the Manufacturing & Industry or Resource sectors, which are far more sensitive to the ups and downs of the economic cycle.

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Edgewell Personal Care Co., symbol EPC on New York, is a buy among consumer products stocks

Edgewell is a leading consumer products company whose brands include Schick, Wilkinson Sword, Edge, Playtex, Wet Ones, Banana Boat, and Hawaiian Tropic.

Energizer Holdings Inc. (symbol ENR on New York) spun off the company in July 2015.

On November 29, 2021, Edgewell announced that it had acquired Billie, a manufacturer of women’s razors and other body-care products, for $310 million in cash.

Billie is an “upstart” brand company that sells directly to consumers a broad portfolio of personal-care products for women. Founded in 2017, Billie targets younger consumers with campaigns that show leg and body hair and promise more affordable products. Billie has a marketing campaign around the so-called pink tax, coined from a study that found that women’s products cost more than similar offerings for men, especially in consumer products.

The deal came just 11 months after Procter & Gamble (symbol PG on New York) terminated its acquisition to buy Billie. That’s after the U.S. Federal Trade Commission sued to block the deal on competition grounds (P&G owns Gillette). Unlike the P&G deal, Edgewell’s transaction was cleared by the Hart-Scott-Rodino Antitrust Improvements Act.

Billie continues to be led by its co-founders, Georgina Cooley and Jason Bravman. The firm has annual sales of about $90 million.

In mid-January, Edgewell began selling Billie products on Walmart.com. A month later it rolled out Billie products to more than 4,000 Walmart (symbol WMT on New York) stores. That’s the first brick-and-mortar store partnership for direct-to-consumer brand Billie.

Meanwhile, Schick is introducing a new bamboo razor. The product is the brand’s first effort at giving consumers an environmentally friendly option for a disposable razor. The razor’s handle is made of 70% renewable bamboo and 30% other materials. The packaging is partly recyclable.

In the quarter ended March 31, 2022, Edgewell’s revenue was $547.7 million, up 5.5% from $519.3 million a year earlier. Revenue was also higher due to strong sales in its Sun Care, Grooming, and Women’s Shave segments, offset by supply-chain issues with its Feminine Care segment and Wet Shave brands.

With Billie, Edgewell gained another strong women’s shaving brand to complement its existing brands such as Schick Intuition, Hydro Silk, and Skintimate. In addition, it strengthened Edgewell’s digital capabilities while expanding Billie’s distribution network.

Edgewell’s outlook remains positive for investors. What’s more, the stock has appeal as a takeover for any competitor looking to gain control of the company’s industry-leading brands. In that event, investors would likely sell their shares at a premium.

Here’s how to find top-performing consumer products stocks to add to your portfolio

It’s essential to invest in stocks that have some history of rising sales, if not profits. Blue-chip stock issuers are generally well-established, dividend-paying corporations with strong business prospects. These are companies that also have strong management that will tend to make the right moves to compete in a changing marketplace.

Strong consumer-products companies share a number of characteristics. These include geographic diversity to protect them from regional economic difficulties, a record of rising cash flow and strong balance sheets. All these are characteristics of blue-chip consumer stocks.

Meanwhile, we believe that a record of increasing dividend payments is a good indication of a strong blue-chip company, especially in a slow economy. High-quality blue-chip stocks will usually be in a position to remain profitable during almost any type of economic hardship or recession. Plus, you get paid blue-chip dividends and earn income while you hold these stocks even if share prices are falling.

Here is what you should know about buying consumer products stocks amid slowdown fears

At TSI Network, we like high-quality blue chip consumer products stocks in part because they can provide stability during economic downturns.

Strong consumer product companies survive slowdowns because they have geographic diversity to protect them from regional economic difficulties, a record of rising cash flow and solid balance sheets.

To protect yourself from economic downturns, we recommend investing in blue chip stocks and stocks that pay dividends. We also recommend using our three-part Successful Investor philosophy for long-term investing in choosing them.

Use our three-part Successful Investor approach for all of your investments, including consumer products stocks

1. Hold mostly high-quality, dividend-paying stocks.
2. Spread your money out across most if not all of the five main economic sectors: Manufacturing & Industry, Resources & Commodities, Consumer, Finance and Utilities.
3. Downplay or stay out of stocks in the broker/media limelight.

Do you find yourself turning to consumer stocks more due to economic uncertainties or are you targeting other types of stocks instead?

How much do you move consumer stocks into or out of your portfolio depending on economic conditions?