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

“With commodity prices coming down huge, the food stocks can turn into recession-proof safe-havens. But it’s a must to be selective, which suggests sticking with the winners that we all know are doing properly,” he stated.

All three main indices fell on Thursday, the final day of the second quarter. The Dow Jones Industrial Average and S&P 500 had their worst quarters for the reason that first quarter of 2020, whereas the Nasdaq Composite had its worst declines since 2008.

The “Mad Money” host stated that packaged food stocks are nice performs throughout turbulent occasions and match the present marketplace for two essential causes.

“First, commodity costs have already begun to break down, and people financial savings stream proper to the underside line. … Second, practically everyone appears satisfied that we’re headed right into a recession, and whereas I’m not completely satisfied, that creates a a lot better backdrop for the Steady Eddie packaged food stocks,” he stated.

Here are his high three picks:

“This isn’t my favourite food play, however I have not felt so good about Campbell Soup in a really, very very long time,” Cramer stated.

The enterprise, which homes famed manufacturers together with Froot Loops, Pop-Tarts and Rice Krispies, is anticipated to finalize the spinoffs by the tip of subsequent yr.

“Their snack division in specific is terrific, and I believe will probably be value much more as an unbiased firm that is not hostage to the a lot slower progress [of the] North American cereal enterprise. Plus, we do not have many good pure performs on snack food,” Cramer stated.

Cramer praised the corporate’s “blowout quarter” and known as the corporate a better of breed operator that is been on the high of its sport for the previous a number of years.

“I believe it is value shopping for right here, however you would possibly need to depart some room to purchase extra the subsequent time we get hit with a market-wide pullback,” Cramer stated.

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