1 Consumer Stock with Competitive Advantages and 2 We Question

Consumer staples stocks are solid insurance policies in frothy markets ripe for corrections. The flip side is that they frequently fall behind growth industries when times are good, and this perception became a reality over the past six months as the sector was down 5% while the S&P 500 was up 9.6%.

Only some companies are subject to these dynamics, however, and a handful of high-quality businesses can deliver earnings growth in any environment. On that note, here is one resilient consumer stock we’ve added to our cart and two we’re swiping left on.

Two Consumer Staples Stocks to Sell:

Hain Celestial (HAIN)

Market Cap: $108.7 million

Sold in over 75 countries around the world, Hain Celestial (NASDAQ:HAIN) is a natural and organic food company whose products range from snacks to teas to baby food.

Why Do We Avoid HAIN?

1. Absence of organic revenue growth over the past two years suggests it may have to lean into acquisitions to drive its expansion
2. Performance over the past three years shows each sale was less profitable as its earnings per share dropped by 61.4% annually, worse than its revenue
3. High net-debt-to-EBITDA ratio of 6× increases the risk of forced asset sales or dilutive financing if operational performance weakens

Hain Celestial is trading at $1.21 per share, or 9.1x forward P/E. Dive into our free research report to see why there are better opportunities than HAIN.

TreeHouse Foods (THS)

Market Cap: $1.24 billion

Whether it be packaged crackers, broths, or beverages, Treehouse Foods (NYSE:THS) produces a wide range of private-label foods for grocery and food service customers.

Why Do We Think THS Will Underperform?

1. Shrinking unit sales over the past two years show it’s struggled to move its products and had to rely on price increases
2. Day-to-day expenses have swelled relative to revenue over the last year as its operating margin fell by 6.4 percentage points
3. Below-average returns on capital indicate management struggled to find compelling investment opportunities, and its falling returns suggest its earlier profit pools are drying up

TreeHouse Foods’s stock price of $24.65 implies a valuation ratio of 13.2x forward P/E. Read our free research report to see why you should think twice about including THS in your portfolio.

One Consumer Staples Stock to Watch:

Vita Coco (COCO)

Market Cap: $3.10 billion

Founded in 2004 followed by a 2021 IPO, The Vita Coco Company (NASDAQ:COCO) offers coconut water products that are a natural way to quench thirst.

Why Do We Watch COCO?

1. Unit sales were phenomenal over the past two years, showing demand is robust and retailers can’t stock enough of its products
2. Earnings per share have massively outperformed its peers over the last three years, increasing by 89.3% annually
3. Market-beating returns on capital illustrate that management has a knack for investing in profitable ventures, and its rising returns show it’s making even more lucrative bets

At $54.23 per share, Vita Coco trades at 37.3x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.

Stocks We Like Even More

Your portfolio can’t afford to be based on yesterday’s story. The risk in a handful of heavily crowded stocks is rising daily.

The names generating the next wave of massive growth are right here in our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Kadant (+351% five-year return). Find your next big winner with StockStory today.