Research>Billionaires Favorite Consumer Staples Stocks
The Motley Fool analyzed 16 billionaire-led hedge funds to determine their top consumer staples stocks
ByJack Caporal –May 3, 2024 at 12:11PM
Key Points
Consumer staple giants: Walmart, Procter & Gamble, Hershey, and Coca-Cola are billionaires' top consumer staples picks.
Defensive diversification: Hedge funds spread their top consumer staple investments among food, beverage, and retail companies.
Finding niches: Billionaire’s top consumer staple holdings include companies with narrow products, such as Hershey and Lamb Weston.
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It turns out that billionaires love Walmart (NYSE:WMT), Procter & Gamble (NYSE:PG), and Costco (NASDAQ:COST) -- at least as investments. Those and other household brands are among the most popular consumer staple stocks found in hedge funds run by billionaires analyzed by The Motley Fool.
Investors turn to consumer staples stocks to hedge against economic slowdowns, and, in some cases, to take advantage of generous dividends. It’s no surprise, then, that billionaire-led hedge funds include consumer staple stocks, although they generally make up 5% or less of their portfolios.
Read on for a deep dive into the consumer staples stocks billionaires are investing in.
Methodology
The Motley Fool analyzed 16 hedge funds run by billionaires to determine what the wealthiest investors are buying. The analysis is based on these funds’ 2023 Q4 Forms 13F.
The following funds are included in the analysis:
- Citadel (Ken Griffin)
- Renaissance Technologies (Jim Simons)
- Bridgewater Associates (Ray Dalio)
- Carl Icahn’s Personal Holdings (Carl Icahn)
- BlueCrest Capital Management (Michael Platt)
- Millennium Management (Israel Englander)
- Tiger Global Management (Chase Coleman)
- D.E. Shaw & Co. (David Shaw)
- Tudor Investment Corp. (Paul Tudor Jones)
- Coatue Management (Philippe Laffont)
- Two Sigma Investments (John Overdeck and David Siegel)
- The Children’s Investment Fund (Christopher Hohn)
- Soros Fund Management (George Soros)
- Caxton Associates (founded by Bruce Kovner)
- Viking Global Investors (Andreas Halvorsen)
- Elliott Management (Paul Singer)
The top consumer staples stocks billionaires are buying
These are the consumer staples stocks that appear in the top 10 consumer staples holdings of more than one of the hedge funds analyzed:
| Stock | Number of Funds Stock Appears in Top 10 Consumer Staples Holdings |
|---|---|
| Walmart | 7 |
| Procter & Gamble | 6 |
| Hershey (NYSE:HSY) | 6 |
| Coca-Cola (NYSE:KO) | 6 |
| Costco | 4 |
| Constellation Brands (NYSE:STZ) | 4 |
| Kroger (NYSE:KR) | 4 |
| Molson Coors (NYSE:TAP) | 4 |
| Monster Beverage Corporation (NYSE:MNST) | 3 |
| Lamb Weston Holdings (NYSE:LW) | 3 |
| CVS Health (NYSE:CVS) | 3 |
| PepsiCo (NASDAQ:PEP) | 3 |
| Darling Ingredients (NYSE:DAR) | 3 |
| Archer-Daniels-Midland (NYSE:ADM) | 3 |
| Mondelez International (NASDAQ:MDLZ) | 3 |
| Kraft Heinz (NASDAQ:KHC) | 3 |
| Sprouts Farmers Market (NASDAQ:SFM) | 2 |
| Post Holdings (NYSE:POST) | 2 |
| Campbell Soup Company (NYSE:CPB) | 2 |
| Keurig Dr Pepper (NASDAQ:KDP) | 2 |
| General Mills (NYSE:GIS) | 2 |
Walmart, P&G, Hershey, and Coca-Cola are the favorite consumer staple stocks held by the billionaire-led funds analyzed for this article.
These funds are relatively diversified when it comes to consumer staples investments. Forty-seven consumer staples companies are in the funds’ top 10 consumer staples holdings. Food producers, food and drug retailers, and beverage companies are the most common.
The top consumer staples stocks billionaires are investing in by hedge fund
Citadel
The top consumer staples stocks held by Citadel
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Coca-Cola | $343,415,341 | 5,827,513 | 0.3% |
| Constellation Brands | $336,499,561 | 1,391,932 | 0.3% |
| Lamb Weston Holdings | $331,245,912 | 3,064,538 | 0.3% |
| Kraft Heinz | $294,518,519 | 7,964,265 | 0.3% |
| Walmart | $265,240,607 | 1,682,465 | 0.3% |
| Costco | $206,995,807 | 313,592 | 0.2% |
| Darling Ingredients | $179,737,842 | 3,606,297 | 0.2% |
| Molson Coors | $133,457,938 | 2,180,329 | 0.1% |
| CVS | $130,155,295 | 1,648,370 | 0.1% |
| Post Holdings | $122,945,760 | 31,051,356 | 0.1% |
- Total value of all consumer staples investments: $2.9 billion
- Percent of portfolio in consumer staples stocks: 3%
Consumer staples don’t take up much of Ken Griffin’s Citadel, but what the hedge fund has invested in that sector is diversified.
Citadel’s top 10 consumer staple investments include three beverage companies; three retail giants in Walmart, Costco, and CVS; and four food and ingredient producers.
None of those investments makes up more than a third of a percentage of Citadel’s overall portfolio.
Renaissance Technologies
The top consumer staples stocks held by Renaissance Technologies
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Hershey | $357,891,000 | 1,919,605 | 0.6% |
| Kroger | $326,665,000 | 7,146,457 | 0.5% |
| Procter & Gamble | $244,140,000 | 1,666,029 | 0.4% |
| Campbell Soup Company | $221,331,000 | 5,119,840 | 0.3% |
| Sprouts Farmers Market | $186,919,000 | 3,885,244 | 0.3% |
| National Beverage Corp. (NASDAQ:FIZZ) | $176,865,000 | 3,557,211 | 0.3% |
| Monster Beverage Corporation | $169,723,000 | 2,946,066 | 0.3% |
| Flowers Foods (NYSE:FLO) | $126,029,000 | 5,598,785 | 0.2% |
| Keurig Dr Pepper | $113,992,000 | 3,421,125 | 0.2% |
| Cal-Maine Foods (NASDAQ:CALM) | $113,777,000 | 1,982,524 | 0.2% |
- Total value of all consumer staples investments: $3.1 billion
- Percent of portfolio in consumer staples stocks: 4.8%
Jim Simons’ Renaissance Technologies tilts its consumer staples holdings toward companies that produce food and drink. Seven of its top 10 consumer staples investments primarily manufacture or produce food or beverages, with chocolate maker Hershey being the fund’s largest consumer staple investment.
Rounding out the top 10 consumer staple holdings of Renaissance are two grocery chains, Kroger and Sprouts Farmers Market, along with Procter & Gamble, the massive consumer goods company.
Bridgewater
The top consumer staples stocks held by Bridgewater Associates
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Procter & Gamble | $680,461,714 | 4,643,522 | 3.8% |
| Coca-Cola | $471,637,062 | 8,003,344 | 2.6% |
| Costco | $453,852,526 | 687,572 | 2.5% |
| PepsiCo | $414,723,804 | 2,441,850 | 2.3% |
| Walmart | $401,028,336 | 2,543,789 | 2.2% |
| CVS | $241,175,740 | 3,054,404 | 1.4% |
| Mondelez International | $175,665,493 | 2,425,314 | 1.0% |
| Monster Beverage Corporation | $90,726,820 | 1,574,845 | 0.5% |
| Kroger | $88,338,597 | 1,932,588 | 0.5% |
| Constellation Brands | $69,870,585 | 289,020 | 0.4% |
- Total value of all consumer staples investments: $3.5 billion
- Percent of portfolio in consumer staples stocks: 19.9%
Consumer staples make up nearly 20% of Ray Dalio’s Bridgewater portfolio -- a larger percentage than any other hedge fund analyzed.
Dalio has bet on a mix of proven market leaders that offer dividends and stability during economic downturns, as well as a couple of companies that seek to drive -- and profit from -- consumer trends.
Bridgewater’s top consumer staple investment is Procter & Gamble, which accounts for 3.8% of the fund’s overall holdings. Coca-Cola, Costo, PepsiCo, and Walmart each make up more than 2% of Bridgewater’s holdings.
The fund is diversified within the consumer staples sector. Its top 10 stocks include household products company Procter & Gamble; beverage companies Coca-Cola, PepsiCo, Monster, and Constellation; retail in Costco, Walmart, and Kroger; and healthcare retail via CVS.
BlueCrest
The top consumer staples stocks held by BlueCrest Capital Management
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Procter & Gamble | $4,927,701 | 33,627 | 0.8% |
| Pepsico | $4,095,182 | 24,112 | 0.7% |
| Walmart | $3,487,691 | 22,123 | 0.6% |
| Coca-Cola | $2,616,138 | 44,394 | 0.4% |
| Costco | $506,941 | 768 | 0.1% |
| Vintage Wine Estates (NASDAQ:VWE) | $57,925 | 5,623,793 | <0.01% |
- Total value of all consumer staples investments: $0.011
- Percent of portfolio in consumer staples stocks: 2.0%
Michael Platt’s BlueCrest Capital Management has minimal exposure to consumer staples and holds just a few stocks in the sector. Its top five consumer staple holdings are dominant brands that provide consistent dividends and stability during volatility.
BlueCrest’s tiny investment in Vintage Wine Estates is an outlier in the fund’s small portfolio of consumer staples.
Millennium Management
The top consumer staples stocks held by Millennium Management
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Walmart | $276,024,813 | 1,750,871 | 0.3% |
| Tyson Foods (NYSE:TSN) | $204,182,436 | 3,798,743 | 0.2% |
| Coca-Cola | $189,403,731 | 3,214,046 | 0.2% |
| Coca-Cola Europacific Partners (NASDAQ:CCEP) | $169,354,619 | 2,537,528 | 0.2% |
| Lamb Weston Holdings | $162,246,333 | 1,501,030 | 0.2% |
| Post Holdings | $154,389,428 | 23,610,104 | 0.1% |
| Kraft Heinz | $152,990,291 | 4,137,109 | 0.1% |
| Archer-Daniels–Midland | $148,125,892 | 2,051,037 | 0.1% |
| J.M. Smucker (NYSE:SJM) | $146,443,078 | 1,158,752 | 0.1% |
| Hershey | $131,300,929 | 704,253 | 0.1% |
- Total value of all consumer staples investments: $2.7 billion
- Percent of portfolio in consumer staples stocks: 2.6%
Nine of the 10 top consumer staples stocks held by Israel Englander’s Millennium Management are food and beverage producers. The only exception is Walmart, the fund’s top consumer staple investment.
That suggests the fund has more conviction in the resiliency of food and beverage manufacturers than in the retailers that sell those products.
Millennium is the only fund analyzed for this article that holds Tyson Foods, Coca-Cola Europacific Partners, and J.M. Smucker in its top 10 consumer staple investments.
D.E. Shaw & Co.
The top consumer staples stocks held by D.E. Shaw & Co.
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Walmart | $280,148,779 | 1,777,030 | 0.4% |
| Procter & Gamble | $276,609,050 | 1,887,601 | 0.4% |
| Sprouts Farmers Market | $86,779,231 | 1,803,767 | 0.1% |
| Mondelez International | $84,374,287 | 1,164,908 | 0.1% |
| Coca-Cola | $81,674,800 | 1,385,963 | 0.1% |
| Archer-Daniels-Midland | $69,160,255 | 957,633 | 0.1% |
| BellRing Brands (NYSE:BRBR) | $50,278,890 | 907,070 | 0.1% |
| Kroger | $49,884,649 | 1,091,329 | 0.1% |
| Hershey | $44,655,736 | 239,518 | 0.1% |
| Molson Coors | $41,232,403 | 673,622 | 0.1% |
- Total value of all consumer staples investments: $1 billion
- Percent of portfolio in consumer staples stocks: 1.5%
The top consumer staple stocks in David Shaw’s hedge fund, D.E. Shaw & Co., incorporate trendier, health-focused brands alongside proven leaders.
The fund’s top two consumer staples holdings are a pair of foundational picks: Walmart and Procter & Gamble. It’s paired those and other resilient industry giants with two newer brands it sees value in:
- Sprouts Farmers Market, a grocery chain that offers natural and organic products.
- BellRing Brands, which provides through its subsidiaries protein shakes, powders, and nutrition bars.
Tudor Investment Corp.
The top consumer staples stocks held by Tudor Investment Corp.
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Walmart | $21,274,868 | 134,950 | 0.3% |
| Constellation Brands | $21,079,150 | 87,194 | 0.3% |
| Procter & Gamble | $16,017,408 | 109,304 | 0.2% |
| General Mills | $14,508,372 | 222,726 | 0.2% |
| Hershey | $14,443,693 | 77,471 | 0.2% |
| Molson Coors | $12,084,445 | 197,426 | 0.2% |
| Freshpet (NASDAQ:FRPT) | $8,832,428 | 101,803 | 0.1% |
| Archer-Daniels-Midland | $7,454,693 | 103,222 | 0.1% |
| Ingredion Incorporated (NYSE:INGR) | $7,262,828 | 66,920 | 0.1% |
| Grocery Outlet Holding Corp. (NASDAQ:GO) | $6,335,600 | 235,000 | 0.1% |
- Total value of all consumer staples investments: $0.164 billion
- Percent of portfolio in consumer staples stocks: 2.3%
Paul Tudor Jones’ Tudor Investment Corp. has spread its top consumer staples investments across household names and smaller, more niche companies.
Its top six consumer staples holdings are giants in their segments and include retail, consumer goods, processed foods, and beverage companies.
Three of its top 10 consumer staples stocks, however, stand out.
- Tudor’s investment in Freshpet suggests that it views health-conscious pet food as more than a short-term trend.
- Its position in Ingredion is a play to tap into the ultra-defensive food ingredients space with upside as the company looks to expand into higher-value ingredients for health foods.
- The fund’s investment in Grocery Outlet Holding Corp. is a way to capture profits from consumers interested in discount shopping.
Coatue Management
The top consumer staples stocks held by Coatue Management
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Beyond Meat (NASDAQ:BYND) | $1,310,498 | 147,247 | 0.0% |
- Total value of all consumer staples investments: $0.001 billion
- Percent of portfolio in consumer staples stocks: <0.01%
Philippe Laffont’s Coatue Management has just a single investment in the consumer staples sector: Beyond Meat. The investment is tiny -- less than a tenth of a percent. Laffont clearly sees much more value in other sectors of the market.
Two Sigma
The top consumer staples stocks held by Two Sigma Investments
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Costco | $229,492,654 | 347,674 | 0.6% |
| General Mills | $221,362,070 | 3,398,251 | 0.5% |
| Hershey | $210,857,487 | 1,130,967 | 0.5% |
| Kroger | $186,904,350 | 4,088,916 | 0.5% |
| PepsiCo | $162,704,003 | 957,984 | 0.4% |
| Monster Beverage Corporation | $121,499,144 | 2,108,994 | 0.3% |
| CVS | $110,595,640 | 1,400,654 | 0.3% |
| Walmart | $87,038,723 | 552,101 | 0.2% |
| Campbell Soup Company | $83,243,256 | 1,925,590 | 0.2% |
| McCormick & Company (NYSE:MKC) | $79,054,521 | 1,155,430 | 0.2% |
- Total value of all consumer staples investments: $1.9 billion
- Percent of portfolio in consumer staples stocks: 5%
The top consumer staple companies held by Two Sigma Investments, led by billionaires John Overdeck and David Siegel, are all household names and top companies in their industries.
Two Sigma’s consumer staple holdings are focused on resilience and steady growth, which are key qualities of consumer staple companies.
The fund is diversified within the consumer staples segment. It is invested in retailers, food and beverage companies, and healthcare retail.
Soros Fund Management
The top consumer staples stocks held by Soros Fund Management
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Darling Ingredients | $7,725,200 | 155,000 | 0.3% |
- Total value of all consumer staples investments: $0.007 billion
- Percent of portfolio in consumer staples stocks: 0.3%
George Soros' hedge fund has only one investment in the consumer staples sector: Darling Ingredients. The company produces sustainable natural ingredients for feed, food, fuel, and fertilizers.
While it’s a small investment in Soros Fund Management, Darling Ingredients is an interesting consumer staple play that captures a diverse range of inputs for other staples while pushing the envelope on sustainability. That offers resiliency not only in cases of economic downturns but also in the face of increasing corporate, government, and consumer scrutiny of businesses’ environmental impact.
Caxton Associates
The top consumer staples stocks held by Caxton Associates
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Coca-Cola | $12,822,048 | 217,581 | 0.7% |
| Kellanova (Kellogg’s) (NYSE:K) | $11,182,000 | 200,000 | 0.6% |
| Hershey | $2,260,212 | 12,123 | 0.1% |
| Albertsons Companies (NYSE:ACI) | $1,388,832 | 60,384 | 0.1% |
| Procter & Gamble | $775,197 | 5,290 | 0.0% |
| Darling Ingredients | $495,011 | 9,932 | 0.0% |
| Mondelez International | $261,907 | 3,616 | 0.0% |
| Seneca Foods Corporation (NASDAQ:SENEA) | $223,971 | 4,271 | 0.0% |
- Total value of all consumer staples investments: $0.029 billion
- Percent of portfolio in consumer staples stocks: 1.5%
Caxton Associates’ top consumer staples stocks are focused on industry leaders and diversification within the sector, and they include one potential opportunity for higher growth.
Darling Ingredients stands out for its growth potential. It is a sustainable producer of ingredients that go into feed, food, fuel, and fertilizers.
Viking Global
The top consumer staples stocks held by Viking Global Investors
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Lamb Weston Holdings | $383,219,692 | 3,545,376 | 1.4% |
| Keurig Dr Pepper | $96,190,542 | 2,886,871 | 0.4% |
- Total value of all consumer staples investments: $0.479 billion
- Percent of portfolio in consumer staples stocks: 1.8%
Andreas Halvorsen’s Viking Global Investors has just two consumer staples investments: potato processing giant Lamb Weston and the beverage and coffee company Keurig Dr Pepper. Its investment in Lamb Weston is more than triple that of its investment in Keurig Dr Pepper. Still, consumer staples make up just 1.8% of Viking’s total portfolio.
Potatoes, soda, and coffee may sound like an odd meal, but it’s a defensive investment combination that Viking Global Investors thinks should offer some respite from volatility and economic downturns.
Elliott Management
The top consumer staples stocks held by Elliott Management
| Stock | Value of Shares | Total Shares | Percent of Portfolio |
|---|---|---|---|
| Constellation Brands | $122,567,250 | 507,000 | 1.3% |
Elliott Management, led by Paul Singer, owns just a single consumer staples stock: Constellation Brands. While Elliott clearly sees more growth opportunities outside of the consumer staples sector, its lone investment in the space is in a company that’s somewhat diversified itself.
Constellation’s portfolio of wine, beer, and spirits is enormous and boasts household brands such as Corona, Modelo, Robert Mondavi, and Kim Crawford. It also has exposure to the cannabis industry through a stake in Canopy Growth Corporation (NASDAQ:CGC), although it has recently signaled less interest in that investment.
How to invest in consumer staples like a billionaire
Consumer staples may not be the most exciting sector to invest in, but even hedge funds led by billionaires see the value of defensive investments that offer some stability during down times. Looking at a selection of hedge funds’ top consumer staples investments yields some lessons the everyday investor can apply.
- Diversify within the sector: The top consumer staples stocks in most funds are spread across a variety of industries: retail, food production, different types of beverages, chocolate and candies, and so on. Even when funds hold just a few consumer staples, the companies they do hold operate in multiple industries.
- Trust the leaders: There are no hidden gems in the top consumer staples holdings for hedge funds. The big, well-known names dominate, such as Costco, Walmart, CVS, and Coca-Cola. There’s a reason for that. Those types of companies have been through every type of economic situation and are still delivering for their shareholders.
- Be patient: Consumer staples companies probably aren’t going to generate life-changing returns, but they can cushion a portfolio in tough markets and provide a steady dividend.
Jack Caporal has positions in Walmart. The Motley Fool has positions in and recommends Beyond Meat, Cal-Maine Foods, Constellation Brands, Costco Wholesale, Darling Ingredients, Freshpet, J.M. Smucker, National Beverage, and Walmart. The Motley Fool recommends CVS Health, Hershey, Kellanova, Kraft Heinz, Kroger, McCormick, and Sprouts Farmers Market and recommends the following options: short April 2024 $50 calls on Darling Ingredients. The Motley Fool has a disclosure policy.
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