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Investing.com -- BofA Global Research has identified several standout performers in the US Consumer Staples sector, highlighting companies with strong growth potential despite varying market challenges.
The consumer staples sector continues to show resilience amid economic fluctuations, with these top-ranked companies demonstrating solid fundamentals and growth strategies. Here’s a closer look at BofA’s top picks:
BofA maintains a Buy rating with a $78 price objective for Coca-Cola, based on 24x CY26E EPS. While analysts lowered their Q3 2025 EPS estimate to $0.76 from $0.77 due to reduced volume forecasts, their long-term outlook remains positive. Regional challenges in Mexico, Japan, Europe, and parts of Asia have impacted volume projections, though North America shows slightly more favorable trends. FY25E, FY26E, and FY27E EPS estimates remain unchanged at $2.97, $3.22, and $3.42, respectively. The declining US Dollar could potentially have a neutral or slightly positive impact on sales and EPS in FY26.
Recent reports indicate The Coca-Cola Company is in discussions with potential buyers, including Bain Capital and Apollo Global Management, for its Costa Coffee chain. Separately, JPMorgan reiterated its Overweight rating on the company.
BofA raised its price objective for Monster from $72 to $75 while maintaining a Buy rating. The firm’s Q3 2025 EPS estimate remains at $0.50, with projected company sales growth of 11.5% year-over-year. US sales are expected to increase by 7.0%, with energy drinks up 9.2% despite an 8.0% decline in alcohol sales. Regional projections include EMEA up 23.1%, APAC up 10.0%, and Latin America up 12.0%. Gross margins are forecast to increase 112 basis points year-over-year to 54.8%, with operating expenses rising 1.9%.
Monster Beverage reported second-quarter earnings that surpassed analyst expectations, with revenue of $2.11 billion and an EPS of $0.52. Following the results, firms including Morgan Stanley and RBC Capital raised their price targets on the stock.
BofA maintains a Buy rating on e.l.f. Beauty, having previously adjusted FY26 sales growth to 26% from 25%. The firm expects stronger contribution from the Rhode brand launch, which has become Sephora’s largest brand launch in North America to date. Despite elasticities dampening Q2 margins, improved mix from fall innovation and Rhode’s contribution are expected to provide favorable offsets later in FY26. Recent price increases implemented in August have successfully offset volume declines across retailers, with long-term growth expected to be primarily volume-driven.
Analysts have had varied views on e.l.f. Beauty, with Morgan Stanley raising its price target, while Deutsche Bank downgraded the stock to Hold from Buy.
BofA maintains its Buy rating and $17 price objective for UTZ, based on 13.5x CY26 EV/EBITDA. Q3 2025 and FY25E adjusted EBITDA estimates remain at $59.3 million and $217.4 million, respectively. Key drivers include total company and organic sales growth of 2.8% year-over-year, with volume/mix up 3.8% and price down 1.0%. Branded salty snacks, representing 88% of total company sales, are projected to grow 5.0%, while gross margins are expected to increase 350 basis points to 42.5%.
Philip Morris International (PM)
BofA’s price objective for Philip Morris is $191, based on 23x 2026E EPS of $8.30. This values PM at a 40-45% premium to its average multiple since July 2017. Despite the company’s PE multiple expansion this year, BofA believes a higher than average multiple is warranted given PM’s operational strength and outlook. Among large-cap multinationals, BofA continues to favor PM, expecting the company to deliver higher organic sales growth compared to peers despite global growth slowdowns.
Philip Morris International reported second-quarter results where earnings per share beat forecasts, though revenue of $10.14 billion fell short of expectations. The company also announced an 8.9% increase in its quarterly dividend.
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