3 Cheap Consumer Stocks to Buy Now: May 2024

Core Insights - The retail sector is divided into consumer staples and discretionary segments, both of which are crucial for U.S. GDP growth [1] - High interest rates have negatively affected consumer spending, but potential rate cuts in the next 12 to 18 months may create opportunities in undervalued consumer stocks [1] - A portfolio of selected consumer stocks is expected to outperform index returns over the next 36 months [1] Consumer Staples - Altria Group (MO) has seen a year-to-date stock increase of nearly 14%, with a forward P/E ratio of 9 and a dividend yield of 8.53% [3][4] - Altria is transforming its business focus towards non-smoking products while still relying on the smokable segment for cash flow [3] - The company reported a shipment volume of NJOY consumables at 10.9 million units, with a retail share increase to 4.3% in the U.S. [3] Consumer Discretionary - PepsiCo (PEP) has a dividend yield of 2.96% and has shown attractive valuations despite subdued growth [6] - For Q1 2024, PepsiCo reported organic revenue growth of 2.7% YOY, with a full-year guidance of 4% organic growth and 8% EPS growth [6] - PepsiCo's total revenue for the last financial year was $92 billion, with$36 billion from international markets, indicating growth potential in Asia Pacific and AMESA regions [6][7] Growth Stocks - Miniso Group (MNSO) stock has increased over 45% in the last 12 months, with a forward P/E ratio of 24 and a dividend yield of 1.67% [8] - Miniso reported Q1 2024 revenue growth of 26% YOY to $515.7 million, with an adjusted EBITDA margin of 25.9% [8] - The company plans to open 900 to 1,100 stores annually from 2024 to 2028, expecting revenue growth at a CAGR of over 20% during this period [8]