Comfort-Food Winners and Losers

During a recession, consumers often turn to comfort foods. What does that mean for these food stocks?
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Updated from 8:49 a.m. EDT

We've all heard the story: During a recession, consumers turn to comfort foods, both for affordability and, well, for comfort.

Many people are foregoing the dinners out and cooking at home. Others are turning to fast food, a perfectly unhealthy combination of cheap and comforting.

McDonald's

(MCD) - Get Report

, which has been trading near the middle of its 52-week range for months, has been edging lower lately, and Jim Cramer said on Monday that it's "

getting too cheap to pass up

."

A comfort-food standout is dry-pasta producer

American Italian Pasta

(AIPC)

, which counts

Wal-Mart

(WMT) - Get Report

as

its largest client

and whose performance

RealMoney's

Steve Gear recently called "extraordinary."

TheStreet.com Ratings

upgraded it to a buy

in December.

The stock has been on a steady rise for the past year from a 52-week low of $4.26, setting

consistent highs

, the last of which occurred on Feb. 25 at the $33.50 level. On Feb. 12, it reported that it earned $26 million, or $1.23 a share, in the prior quarter, compared with year-ago earnings of $1.4 million, or 7 cents a share. It closed down 35 cents, or 1.2%, at $30.41 on Wednesday, March 11.

On Feb. 19's "Mad Money" episode, Jim Cramer said the stock was "

exactly what you should be buying

."

This makes sense within the comfort-food theory. Pasta, of course, is an ultimate comfort food. Who wouldn't find solace in Grandma's cheesy lasagna, a rich fettuccine alfredo or a perfect-for-leftovers cheeseburger casserole? Its versatility is another draw, crossing cuisine boundaries and allowing for both the most basic and high-end culinary creations. Pair your elbow noodles with tomato sauce from the can, or dress up your whole wheat linguine with leeks or roasted fennel.

Plus, by all accounts, the stuff's delicious.

Sticking with the pasta theme, let's take a look at some other comfort-food stocks and see how they've been faring lately.

Once you've got your pasta, you need your sauce. Simple options include olive oil or butter with a sprinkle of

Kraft

(KFT)

parmesan cheese, or a premade canned sauce, such as

Campbell Soup's

(CPB) - Get Report

Prego or

Heinz's

(HNZ)

Catelli.

ConAgra's

(CAG) - Get Report

Hunt's brand makes a sauce, too, or you can pick up its canned tomatoes and make your own.

Campbell Soup announced on Feb. 23 that

its second-quarter profit had dropped 15%

, though Cramer said it was a "

decent quarter with good margin growth

." On Wednesday, it closed down 72 cents, or 2.7%, at $25.59 after hitting a new 52-week low of $25.54 earlier in the day. It yields 3.9%.

Heinz, which is one of

Navellier & Associates' holdings

, had

its numbers reduced in February by UBS

due to weaker consumer behavior. On Feb. 24, Heinz announced that

third-quarter profit rose 11%

, but Cramer

isn't excited about the stock

. It closed on Wednesday down 47 cents, or 1.5%, at $31.48, after hitting a 52-week low of $30.51 on Friday. Heinz yields 5.4%.

ConAgra yields 5.3% and closed down 56 cents, or 3.8%, at $14.02 on Wednesday. On the

Feb. 27 episode of "Mad Money,"

Cramer said that he liked ConAgra. "Like every other food stock, they're going down, but I like that yield. I'd buy on a scale on the way down," he said.

If time's an issue, you might want to buy your pasta with sauce included. Kid-friendly brands include ConAgra's Chef Boyardee canned pastas and

General Mills'

(GIS) - Get Report

Hamburger Helper. For big broods, add extra pasta (and water) to the Hamburger Helper mix; it cuts down on the sodium, too.

Pepsi's

(PEP) - Get Report

Quaker brand also offers pasta-and-sauce mixes in such flavors as creamy parmesan, stroganoff and primavera.

Cramer owns General Mills for his

Action Alerts PLUS

charitable trust and on Feb. 24 said it "

had a fantastic second half of the year

." It yields 3.5% and closed down 76 cents, or 1.5%, to $49.43 on Wednesday after hitting a new 52-week low of $49.17 earlier in the day.

He also owns Pepsi, which he said on

a recent episode of "Stop Trading!"

he prefers to

Coca-Cola

(KO) - Get Report

. Pepsi yields 3.7% and closed up 82 cents, or 1.8%, at $47.42 on Tuesday.

And you can't go wrong with a classic. Kraft, whose Macaroni & Cheese kids adore and adults nostalgically indulge in, is owned by Buffett, though even the master investor's portfolio has been

taking a beating

lately. Kraft, which yields about 5.1%, hit a 52-week low of $20.81 on March 5 and closed down 48 cents, or 2.2%, on Wednesday at $21.32.

Of course, if you're going to make all that pasta, you'll need a good stock pot. Popular choices are the Calphalon brand from

Newell Rubbermaid

(NWL) - Get Report

and

Whirlpool's

(WHR) - Get Report

Kitchen Aid line.

Newell Rubbermaid, which hit a 52-week low on March 9 of $4.51, closed up 6 cents, or 1.3%, at $4.86 on Wednesday; it yields a hearty 9.3%. Whirlpool closed up $1.30, or 5.6%, at $24.41 after

reiterating its expectations-beating outlook for the year

. It yields 8.9%.

For low-budget restaurant pasta, check out the Olive Garden, owned by

Darden Restaurants

(DRI) - Get Report

and

Yum! Brands'

(YUM) - Get Report

Pizza Hut, whose pasta, according to the commercials, is easily confused with high-end restaurant concoctions.

Darden yields 2.9% and closed down 18 cents at $26.79 on Wednesday. Cramer recently

said he likes the stock

. Yum!, one of TSC Ratings' top five

all-around-value stocks

for Feb. 24, yields 3.2% and closed up 46 cents, or 1.8% at $25.40.