Crisis in the Ukraine shows the Value...
Home  »  Community News  »  Crisis in the Ukrain...
Mar
6
Tim Lambert
Crisis in the Ukraine shows the Value of Defensive Stocks
Blog
0
, , , , ,

Global financial markets have been roiled by the financial crisis in the Ukraine.

While there are many points being made, one of the important ones for investors in the critical role of defensive stocks in a portfolio.  Some of the best are from the food sector, ranging in size from giants such as Coca-Cola (NYSE:KO) and Kraft Foods (NASDAQ: KRFT) to promising small caps like SoupMan (NASDAQ: SOUP) and High Performance Beverages (OTN: TBEV).

Coca-Cola and Kraft Foods need no introduction.

In a way, neither does SoupMan, at least to fans of “Seinfeld,” the comedy classic.  It is the company from the legendary “Soup Nazi” episode of the series.  For mixed martial arts fans, High Performance Beverages is well known from its affiliated product line.  Both have tremendous growth potential. For SoupMan, that is shown by its soaring revenues.  It should be coming for High Performance Beverages from its partnership with Mussetter Distributing.

Kraft Foods and Coca-Cola will not deliver the high growth that can come from a stock like High Performance Beverages or SoupMan.

But there is a solid, steady stream of income.  That is what helps to provide a foundation to the stock in times of turmoil around the world.  The global presence and widespread brand appeal of the product lines of Coca-Cola and Kraft Foods also increase the appeal of these equities as sources of stability in a portfolio.

When the situation in the Ukraine calms down, the demand will continue to increase for the products of High Performance Beverages, Kraft Foods, SoupMan, and Coca-Cola.

The world’s consuming class will increase by one billion, according to a study by McKinsey & Co., the global consulting firm.  That will result in trillions and trillions of dollars more in consumer spending.  A more affluent diet is always a primary spending area of consumers will more disposable income. This is very bullish for Kraft Foods, Coca-Cola, The Original SoupMan, and High Performance Beverages, no matter what the global geopolitical situation.



Share on StockTwits

Leave a reply

Your email address will not be published. Required fields are marked *