In this article, we will look at the 12 Undervalued Defensive Stocks for 2026.
On March 20, John Kolovos, Macro Risk Advisors, appeared on CNBC’s ‘Closing Bell Overtime’ to talk about the state of the market and whether investors should be cautious. His caution predates Iran, and he said that he has been telling clients the same thing: bull markets look like bull markets and bear markets look like bear markets. This doesn’t necessarily look like a bull market, and is starting to look more and more like a bear market. He was of the view that the sequence of things is important, as we already have this initial decline lower coming down to support.
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We are probably going to get close to an exhaustive move, according to him, maybe at some point next week, maybe a sucker rally, and then put in that lower low. Kolovos further stated that it is important to remember that corrections unfold in three stages, initial move lower, which is what we have. We haven’t had that oversold bounce yet, and then we will get that broader swoosh lower, which may be around 6300 if not 6100.
With these broader market trends in view, let’s look at the best undervalued defensive stocks for 2026.
Our Methodology
We used the Finviz stock screener to compile a list of the best defensive stocks with a forward P/E below 15 and selected the top 12 most popular among elite hedge funds as of Q3 2025. We sourced the hedge fund data from Insider Monkey’s database. The stocks are ranked in ascending order of hedge fund sentiment.
Note: All data was recorded on March 23.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
12 Undervalued Defensive Stocks for 2026
12. Magnum Ice Cream Company N.V. (NYSE:MICC)
Magnum Ice Cream Company N.V. (NYSE:MICC) is one of the best undervalued defensive stocks for 2026. Goldman Sachs downgraded Magnum Ice Cream Company N.V. (NYSE:MICC) to Sell from Neutral on March 19, bringing the price target down to EUR 13 from EUR 13.70. The firm attributed the downgrade to very low visibility on cash generation and new top-line risk, noting that the company’s cold chain distribution requirements expose earnings to higher oil prices.
In its full year 2025 results, Magnum Ice Cream Company N.V. reported revenue of €7.9 billion (FY 2024: €7.9 billion), with 4.2% organic sales growth (OSG) year-on-year, as well as volume growth of +1.5% and price growth of +2.6%. Operating profit was €599 million, highlighting a planned net increase of €118 million in separation and restructuring costs in 2025 vs 2024 and the forex translation effect.
Magnum Ice Cream Company N.V. also reported an adjusted EBITDA margin 15.9%, which was impacted by forex translation effects and previously allocated depreciation costs.
Magnum Ice Cream Company N.V. manufactures and sells ice cream brands and products tailored for both at-home and away-from-home consumption. The company’s operations are divided into the following geographical segments: Americas, Asia, and the Middle East, Turkey, South Asia, and Africa (METSA).
11. Diageo plc (NYSE:DEO)
Diageo plc (NYSE:DEO) is one of the best undervalued defensive stocks for 2026. On March 2, Diageo plc (NYSE:DEO) was downgraded to Hold from Buy, with the firm setting a price target of 1,800 GBp. The firm attributed the downgrade to uncertainty over when the company’s U.S. volumes will bottom. It further told investors in a research note that Diageo plc (NYSE:DEO) lowered its fiscal 2026 guidance to reflect factors such as challenges in Chinese white spirits, a weaker-than-expected U.S. spirits category, and a weaker consumer in China.
The company’s 2026 interim results for the six months ended 31 December 2025, showed reported net sales of $10.5 billion, which declined 4.0% due to organic net sales decline and the negative impact of disposals. Diageo plc (NYSE:DEO) also reported that organic net sales declined 2.8%, driven primarily by organic volume down 0.9% and negative price/mix of 1.9%. In addition, strong organic net sales growth in Europe, Latin America and Caribbean (LAC), and Africa was more than offset by softer performance in North America.
Diageo plc (NYSE:DEO) is involved in the production and distribution of alcoholic beverages. Its brands include Johnnie Walker, Crown Royal, J&B and Buchanan’s whiskies, Smirnoff, Ciroc and Ketel One vodkas, Captain Morgan, Baileys, Don Julio, Casamigos, Tanqueray, and Guinness. The company’s operations are divided into the following geographical segments: North America, Europe, Asia Pacific, Latin America and Caribbean, Africa, and Corporate and Other.
10. Pilgrim’s Pride Corporation (NASDAQ:PPC)
Pilgrim’s Pride Corporation (NASDAQ:PPC) is one of the best undervalued defensive stocks for 2026. On March 13, BTG Pactual initiated coverage of Pilgrim’s Pride Corporation with a Neutral rating and set a $40 price target. In its fiscal Q4 and full year 2025 financial results, the company reported net sales of $18.5 billion for the year, with a consolidated GAAP operating income margin of 8.7%. GAAP net income came up to $1.1 billion, with a GAAP EPS of $4.54, adjusted net income of $1.2 billion, and adjusted EPS of $5.17. For the fourth quarter, net sales came up to $4.5 billion, with a consolidated GAAP operating income margin of 4.5%.
Management reported that Pilgrim’s Pride Corporation’s U.S. Fresh portfolio benefited from strong demand across retail and foodservice, with volume from Key Customers in both Case Ready and Small Bird rising above the industry averages. Management also reported that Big Bird drove improvements through enhanced yields, mix, and cost efficiencies.
Pilgrim’s Pride Corporation is involved in the processing, production, marketing, and distribution of fresh, frozen, and value-added chicken and pork products to retailers, distributors, and foodservice operators. The company’s operations are divided into the following geographical segments: U.S., Europe, and Mexico.
9. Ingredion Incorporated (NYSE:INGR)
Ingredion Incorporated (NYSE:INGR) is one of the best undervalued defensive stocks for 2026. Ingredion Incorporated (NYSE:INGR) was initiated with a Buy rating by Benchmark on March 17, with the firm assigning a $130 price target to the stock. In a separate development, Ingredion Incorporated announced on March 18 that its board of directors has declared a quarterly dividend of $0.82 per share on the company’s common stock. It stated that the quarterly dividend will be payable on April 21, 2026, to stockholders of record at the close of business on April 1, 2026.
Previously, Ingredion Incorporated announced on February 11 that its Board of Directors unanimously elected Jim Zallie, President and CEO, to assume the additional role of chairman of the board, effective immediately. The company reported in its fiscal Q4 and full-year 2025 results that it anticipates its full-year 2026 outlook for reported and adjusted EPS to be in the range of $11.00 to $11.80.
Ingredion Incorporated is a global ingredients solutions provider that transforms fruits, vegetables, grains, and other plant-based materials into value-added ingredient solutions for several markets, including food, beverage, animal nutrition, brewing, and industrial markets. The company’s products are primarily derived from the processing of corn and other starch-based materials, including rice, potato, and tapioca. It operates through four segments: North America, South America, Asia-Pacific, and Europe, the Middle East and Africa (EMEA).
8. Archer-Daniels-Midland Company (NYSE:ADM)
Archer-Daniels-Midland Company (NYSE:ADM) is one of the best undervalued defensive stocks for 2026. Archer-Daniels-Midland Company (NYSE:ADM) announced on March 12 a new initiative with American Farmland Trust to partner with hundreds of farmers across Illinois, Indiana, Iowa, Kansas, Kentucky, and Missouri. It stated that the $500,000 investment from ADM Cares is a part of ADM’s Farm Forward Initiative, which is its long-term commitment to working alongside American farmers to bolster resilience in a rapidly changing agricultural landscape.
Management stated that the partnership will allow ADM Cares and AFT to engage American farmers to offer connections to production resources and peer networks, direct technical assistance for succession planning, and grant funding to support productivity, market access, and farmer well-being.
In a separate development, Archer-Daniels-Midland Company received a rating update from Barclays on February 19. The firm lifted the price target on the stock to $68 from $61 and maintained an Equal Weight rating on the shares.
Archer-Daniels-Midland Company is a human and animal nutrition company that serves as an agricultural processor and supply chain manager. It operates through the Carbohydrate Solutions, Nutrition, and Ag Services and Oilseeds segments.
7. The Campbell’s Company (NASDAQ:CPB)
The Campbell’s Company (NASDAQ:CPB) is one of the best undervalued defensive stocks for 2026. On March 13, UBS cut the price target on The Campbell’s Company (NASDAQ:CPB) to $20 from $24 while maintaining a Sell rating on the shares. The rating update came after The Campbell’s Company reported its fiscal Q2 2026 financial results on March 11, reporting that net sales decreased 5% to $2.6 billion and decreased 3% on an organic basis. In addition, Earnings Before Interest and Taxes (EBIT) dropped to $273 million, while adjusted EBIT decreased 24% to $282 million.
The Campbell’s Company also reported that Earnings Per Share (EPS) decreased to $0.48, and adjusted EPS decreased 31% to $0.51. In addition, fiscal year-to-date cash flow from operations was $740 million, and the company returned $263 million to shareholders, including $237 million in dividends. Management stated that net sales were impacted by approximately 1% due to January storm-related shipment delays and associated supply chain costs. The factors also affected adjusted EBIT by approximately $14 million and adjusted EPS by approximately $0.04 per share in the quarter.
Formerly known as Campbell Soup Company, The Campbell’s Company offers affordable food and beverages, with its operations divided into two divisions: Snacks and Meals & Beverages. Its brand portfolio comprises approximately 16 brands, including Campbell’s, Cape Cod, Chunky, Goldfish, Kettle Brand, Lance, Late July, Pace, Pacific Foods, Pepperidge Farm, and others. The company’s North American Foodservice division offers recipes, food, and tailored solutions for a range of segments, including restaurants, healthcare facilities, specialty coffee shops, lodging, schools, and more.
6. Conagra Brands, Inc. (NYSE:CAG)
Conagra Brands, Inc. (NYSE:CAG) is one of the best undervalued defensive stocks for 2026. Conagra Brands, Inc. (NYSE:CAG) received a rating update from JPMorgan on March 20. The firm cut the price target on the stock to $17 from $19 and maintained a Neutral rating on the shares. The rating update came as part of a fiscal Q3 preview, with the firm stating that the company’s earnings growth could be limited by inflation going forward.
In a separate development, Conagra Brands, Inc. was downgraded to Underweight from Equal Weight by Wells Fargo on March 12. The firm also cut the price target on the stock to $15 from $20, telling investors in a research note that it downgraded three food names to Underweight, citing their higher leverage and dividend payout ratios as well as earnings risk. It added that factors such as the “convergence” of earnings risk, higher leverage, and “tight” dividends will likely drive share underperformance relative to peers. The firm also stated that it sees negative profit catalysts for Conagra Brands, Inc..
Conagra Brands, Inc. is a consumer-packaged goods food company that operates in three segments: Grocery & Snacks, Refrigerated & Frozen, and International. Its brand portfolio encompasses Birds Eye, Duncan Hines, Healthy Choice, Marie Callender’s, Reddi-wip, and BOOMCHICKAPOP.
5. Bunge Global SA (NYSE:BG)
Bunge Global SA (NYSE:BG) is one of the best undervalued defensive stocks for 2026. BofA lifted the price target on Bunge Global SA (NYSE:BG) to $130 from $125 on March 11, reiterating a Buy rating on the shares. The firm told investors that it sees the company’s Investor Day positively, given higher-than-expected midcycle EPS of $13-$15, a rise in the synergy target, as well as the discussion of additional margin-enhancing opportunities as the company leverages the combined platform and tech. BofA added that it thinks of the event as a hurdle that investors had to overcome for fear of a disappointing outlook. It also believes that now that the obstacle has passed, the shares can power even higher.
Bunge Global SA also received a rating update from BMO Capital on March 11. The firm lifted the price target on the stock to $135 from $130, reiterating an Outperform rating on the shares and stating that the company’s investor day presentation was positive as the management laid out a framework to achieve the $15 mid-cycle EPS baseline by 2030. It also told investors in a research note that it has come away with increased confidence in Bunge Global SA’s multi-year earnings trajectory.
Bunge Global SA is a global agribusiness and food company. Its product offerings include canned and frozen vegetables, spices, vegetable oils, wine vinegar, fruit spreads, canned meats and beans, and other items. It sells its products through the brands Mrs. Dash, Ortega, Back to Nature, Bear Creek, Green Giant, and Cream of Wheat.
4. General Mills, Inc. (NYSE:GIS)
General Mills, Inc. (NYSE:GIS) is one of the best undervalued defensive stocks for 2026. RBC Capital cut the price target on General Mills, Inc. (NYSE:GIS) to $55 from $60 on March 19, maintaining an Outperform rating on the shares and telling investors in a research note that the company delivered a mixed quarter with performance affected by weather. However, it added that General Mills, Inc. maintained fiscal year 2026 guidance as these dynamics are anticipated to reverse in fiscal Q4.
General Mills, Inc. also received a rating update from TD Cowen on the same day. The firm cut the price target on the stock, bringing it down to $37 from $45 and reaffirming a Hold rating on the shares. It told investors that the company missed fiscal Q3 EPS but maintained guidance, and the inventory headwinds are expected to largely reverse in fiscal Q4. Although management stated that it is finished with price adjustments to improve affordability, TD Cowen lowered estimates for fiscal year 2027 EPS to take into account margin pressure from incentive comp, rising costs, and weak sales, which they are unlikely to offset with price increases, according to the firm.
General Mills, Inc. manufactures and markets branded consumer foods, including natural and organic food items. The company’s brand portfolio includes Annie’s, Betty Crocker, Cheerios, Wheaties, and more. Its operations are divided into the North America Retail, International, North America Pet, and North America Foodservice segments.
3. Dollar Tree, Inc. (NASDAQ:DLTR)
Dollar Tree, Inc. (NASDAQ:DLTR) is one of the best undervalued defensive stocks for 2026. Truist cut the price target on Dollar Tree, Inc. (NASDAQ:DLTR) to $142 from $156 on March 17 and maintained a Buy rating on the shares. The firm told investors in a research note that it expects trends to continue to improve as the company boosts its store standards, optimizes inventory, increases product value, and the like.
The rating update came after Dollar Tree, Inc. reported its fiscal Q4 and full year 2025 results on March 16, reporting fiscal Q4 comparable store net sales growth of 5.0% and fiscal Q4 diluted EPS from continuing operations of $2.56. It added that net sales growth in fiscal year 2025 reached 10%, while comparable store net sales growth was 5.3%. In addition, FY25 diluted EPS from continuing operations was $5.94.
Dollar Tree, Inc. also provided additional business highlights, stating that it opened 402 new stores in fiscal 2025 and converted or added around 2,400 stores to the Dollar Tree 3.0 multi-price format, ending the year with approximately 5,300 multi-price stores.
Dollar Tree, Inc. operates discount department stores and offers a wide range of merchandise under the business segments Dollar Tree and Family Dollar. Dollar Tree stores offer consumable merchandise, seasonal goods, and variety merchandise. The Family Dollar segment is a general merchandise retail discount store offering affordable merchandise in convenient neighborhood locations.
2. Lamb Weston Holdings, Inc. (NYSE:LW)
Lamb Weston Holdings, Inc. (NYSE:LW) is one of the best undervalued defensive stocks for 2026. BofA cut the price target on Lamb Weston Holdings, Inc. (NYSE:LW) to $49 from $53 on March 13, reiterating a Neutral rating on the shares. The firm told investors that the company is likely to experience increased earnings pressure in the second half as compared to the first half, as well as competitive challenges that are likely to pressure the balance of the year. It further told investors in a research note that these trends hold especially true as Lamb Weston Holdings, Inc. competes against the export markets of China and India.
In a separate development, Lamb Weston Holdings, Inc. announced on March 4 that it will release financial results for fiscal Q3 2026 on April 1, with the news release issued at around 8:30 a.m. ET, and followed by a conference call at 10:00 a.m. ET. The company reported in its fiscal Q2 2026 results that net sales rose $17.2 million to $1.618 billion compared to the prior year period, and included a favorable foreign currency impact of $24.4 million.
Lamb Weston Holdings, Inc. is involved in the production, distribution, and marketing of value-added frozen potato products. The company’s operations are divided into the North America and International segments.
1. Constellation Brands, Inc. (NYSE:STZ)
Constellation Brands, Inc. (NYSE:STZ) is one of the best undervalued defensive stocks for 2026. Constellation Brands, Inc. (NYSE:STZ) received a rating update from Citi on March 18. The firm updated the stock to Buy from Neutral, while raising the price target to $175 from $155. Citi told investors in a research note that beer scanner data has experienced an improvement ahead of the summer season. It added that Constellation Brands, Inc.’s comparisons remain easy through 2026, with the company cycling through the beer category weakness of last year. The firm also attributed the rating and price target upgrade to the stock’s historically low valuation levels, as well as the company’s improved sales trends.
In a separate development, Constellation Brands, Inc. announced its CEO succession plan on February 12, stating that its Board of Directors has appointed Nicholas Fink as the company’s next President and Chief Executive Officer, effective April 13, 2026. Fink, who has been a member of the company’s Board of Directors since 2021, is set to succeed current President and CEO Bill Newlands and will continue to serve on the company’s Board.
Constellation Brands, Inc. produces, markets, and distributes wine, beer, and spirits. It operates through the Beer, Wine, Spirits, Corporate Operations and Other, and Canopy segments.
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