This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

5 Defensive Stocks to Protect Your Money

BOSTON ( TheStreet) -- With crude oil costing more than $100 a barrel, the Middle East region on the brink and the Federal Reserve ending its bond-buying program soon, investors' sentiment has turned. Just yesterday, the S&P 500 fell 1.9% after jumping 24% since September. The following consumer-staples stocks -- shares of companies that produce goods needed to live -- are ranked highest by TheStreet's quantitative equity model.

Of note: Several of the following stocks represent food-products companies, which are subject to higher costs due to the recent rise in commodity prices. Their ability to pass on increased prices to consumers, without affecting demand, varies on a case-by-case basis. TheStreet's stock model incorporates both fundamental and technical factors. The stocks are ordered by net score, from good to great.

5. Hershey (HSY - Get Report) is a confectioner.

Hershey's fourth-quarter net income increased 6.9% to $136 million and earnings per share rose 7.3% to 59 cents, helped by a smaller float. Revenue grew 5.4% to $1.5 billion. Hershey's gross margin widened from 44% to 46%, but its operating margin narrowed from 17% to 16%. Hershey held $885 million of cash and $1.8 billion of debt at quarter's end, for a quick ratio of one and a debt-to-equity ratio of two. It pays a quarterly dividend of 35 cents, equal to a yield of 2.6% with a payout ratio of 59%. Hershey has grown profit 33% a year, on average, since 2008.

The stock has been a top performer in the packaged foods industry, having risen 29% in the past 12 months and 15% annually, on average, since 2008. It trades at a premium to food products peer averages, costing 24-times trailing earnings, 18-times forward earnings and 2.2-times sales. Its cash flow multiple of 14 reflects a discount of 26% to the industry average. Of analysts covering Hershey, six, or 33%, advise purchasing its shares, 11 suggest holding and one advocates selling them. Citigroup offers the highest target, at $60, implying 12% of upside in the next 12 months.

1 of 5

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
CHD $85.06 0.00%
HRL $56.35 0.00%
HSY $100.27 0.00%
MKC $76.47 0.00%
SJM $117.42 0.00%

Markets

DOW 17,826.30 -279.47 -1.54%
S&P 500 2,081.18 -23.81 -1.13%
NASDAQ 4,931.8150 -75.9760 -1.52%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs