In this article, we look at the Top 10 Consumer Defensive Stocks to Buy Now.
Early in the year, the equity markets experienced a strong rotation into consumer defensive stocks. The rotation came as investors questioned the sustainability of high valuations and the momentum of artificial intelligence. The rally helped push the S&P 500 consumer staples index forward price-to-earnings multiple to its highest level since 1999.
After rallying by about 13% through early February, the consumer defensive sector has since pulled back. Cracks in the segment began to appear as the Middle East conflict broke out, prompting concerns of heightened inflation that would erode consumer purchasing power and, consequently, hurt earnings growth. The sector also came under pressure as investors started to question high valuations amid concerns about earnings prospects.
“Rising inflation expectations tied to potential escalation with Iran could begin to undermine the defensive appeal of staples, particularly given how strongly the sector has already performed this year,” said Neil Wilson, investor strategist at Saxo.
Despite a significant pullback from all-time highs, consumer defensive stocks are still up for the year. The S&P 500 consumer staples sector is up about 9% year to date, outpacing the broader S&P 500, which is flat over the same period.
Consumer defensive stocks outlook remains positive, especially on artificial intelligence worries returning to the fore. After years of dominance driven by AI hype and low-rate-fuelled growth, concerns over regulatory scrutiny of AI spending and a normalizing interest rate environment are already prompting investors to pivot into more defensive sectors.
“In this period now where we are living through so much? AI-related uncertainty, including around its potential impact on which companies survive and broader employment, staples have a benefit in investors’ minds because they are not in AI’s path of destruction,” said Erika Maschmeyer, portfolio manager at Columbia Threadneedle.
During periods of uncertainty and market broadening, capital tends to flow from high-growth cyclical to defensive. Consequently, staples have emerged as a soft spot amid broader selloffs. Leading the charge have been consumer defensive companies demonstrating stability and subtle growth drivers.
Our Methodology
To compile a list of the Top 10 Consumer Defensive Stocks to Buy Now, we used the Yahoo Finance Screener and Consumer Defensive ETFs to scan for stocks. We focused on consumer defensive companies with a market cap of more than $20 billion that offer stability during market volatility. We shortlisted stocks with over 10% upside potential (as of April 11) that were also popular among elite hedge funds in Q4 2025. Finally, we ranked the stocks in ascending order based on their upside potential.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research shows 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).
Top Consumer Defensive Stocks to Buy Now
10. Walmart Inc. (NYSE:WMT)
Stock Upside Potential: 10.14%
Number of Hedge Fund Holders: 114
Walmart Inc. (NYSE:WMT) is one of the top consumer defensive stocks to buy now. On April 2, Erste Group upgraded Walmart Inc. (NYSE:WMT) to a Buy from a Hold, impressed by the company’s fourth-quarter performance and guidance.
The company delivered strong revenue growth, up 5.6% to $190.7 billion. The growth was driven by a 24% increase in global commerce sales, while the global advertising business grew 37%. The company also posted earnings per share of $0.74. The giant retailer expects its first-quarter sales to increase by between 3.5% and 4.5%, and its operating income to increase by between 4% and 6%. Adjusted earnings per share are expected at between $0.63 and $0.65.
Erste Group is optimistic that Walmart will exceed its own earnings forecast. The optimism stems from the fact that the company is experiencing growth in consumer transactions, led by digital and broad-based share gains. The company also experienced significant growth in advertising.
On the other hand, Da Davidson expects Walmart to be one of the beneficiaries of a strong tax refund season since 2013. Through March 27, the IRS had received 63 million returns representing over 40% of the 145.9 million filed in 2025.
Walmart Inc. (NYSE:WMT) is a massive multinational retail corporation operating a tech-powered omnichannel model across hypermarkets, discount department stores, and grocery stores worldwide. It focuses on providing affordable goods and operates through the Walmart U.S., Walmart International, and Sam’s Club divisions. The company also generates revenue via e-commerce, advertising, and fulfillment services.
9. PepsiCo, Inc. (NASDAQ:PEP)
Stock Upside Potential: 12.08%
Number of Hedge Fund Holders: 74
PepsiCo stock (NASDAQ:PEP) is one of the top consumer defensive stocks to buy now. On April 8, JPMorgan reiterated an Overweight rating on PepsiCo stock (NASDAQ:PEP) but lowered the price target to $172 from $176.
The price target cut is in response to the company maintaining its 2026 organic sales growth at 2.5%, with earnings per share expected at $1.55. On the other hand, the investment bank lowered the company’s organic sales growth to 3.1% from 3.3%, and also lowered the earnings per share estimate to $8.54 from $8.64. The estimate is still above the consensus of $8.60 a share.
Earlier, analysts at BofA Securities reiterated a neutral rating on the stock with a $173 price target. The neutral rating aligns with expectations that the company will deliver first-quarter results in line with consensus estimates. The research firm expects the company to deliver earnings per share of $1.53 and $8.60 for the full year.
PepsiCo, Inc. (NASDAQ:PEP) is a global food and beverage leader that manufactures, markets, and sells iconic snacks (Frito-Lay, Doritos, Cheetos, Lay’s) and beverages (Pepsi, Mountain Dew, Gatorade, Aquafina).
