Business

Jim Cramer says investors can hide in these three recession-proof packaged food stocks

CNBC’s Jim Cramer on Thursday presented investors with three options for stockpiles of packaged food they can seek refuge in, as the stock market continues to be precarious.

“With commodity costs plummeting, food stocks can become a safe haven against a recession,” he said. “But you have to be selective, which means stick with the winners that we get,” he said. I know I’m doing well,” he said.

All three major indexes fell on Thursday, the last day of the second quarter. The Dow Jones Industrial Average and the S&P 500 had their worst quarters since the first quarter of 2020, while the Nasdaq Composite had its worst declines since 2008.

The “”Crazy money“The presenter argues that stocking up on packaged foods is a great source of supply in turbulent times and fits the current market for two main reasons.

“First, commodity prices have started to fall and those savings are flowing all the way. … Second, nearly everyone believes we are entering a recession, and while I am not entirely convinced, that makes for much better context for Steady Eddie’s packaged food warehouse,” he said.

Here are his top three picks:

Third place: Campbell Soup

Campbell beat on its top and bottom lines in the latest quarter and also raised its full-year revenue forecast.

“It’s not my favorite dish, but I haven’t felt good about Campbell Soup in a very long time,” says Cramer.

2nd place: Kellogg

Kellogg said last week that it is planning to spin off into three separate companies that will split their brands into fast food, cereal and plant segments.

The business, which has popular franchises including Froot Loops, Pop-Tarts and Rice Krispies, is expected to complete the spin-off by the end of next year.

“Their fast food division in particular is amazing, and I think it would be worth a lot more as an independent company not to be held hostage to much slower growth. [of the] North American grain business. Plus, we don’t have a lot of pure drama about fast food,” Cramer said.

1st place: General Mills

General Mills beat Wall Street estimates on revenue and earnings for its latest quarter, though its full-year profit outlook fell short of analyst estimates. Shares hit a new 52-week high on Thursday.

Cramer praised the company’s “losing quarter” and called the company the best seed operator that has been at the top of its game over the past few years.

“I think it’s worth buying here, but you might want to leave room to buy more next time we have a market-wide sale,” Cramer said.

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