5 best food stocks to buy for Q4 2023
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The food industry includes grocery stores, manufacturers, and other companies selling non-alcoholic beverages. Many food-related stocks also fall into the consumer staples sector and are considered recession-proof. Use our handy guide to find the best stocks to buy in the food sector.
What are the top food stocks to buy?Copy link to section
Our experts have analysed the market and found the best food stocks to buy for 2023. You can find our selections in the table below, and if you want to buy any stock, just click the buttons. Or keep scrolling to learn more about each company.
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1. Archer-Daniels-Midland (AMD)Copy link to section
Archer-Daniels-Midland is a leader in the food and agriculture sector, offering a wide range of products from animal feed to speciality oils. The company plays a key role in the global production of corn, wheat, and cooking oil. With its long-standing growth and steady expansion of products and services, ADM has seen a 250% increase in its share price over the past decade.
For investors looking to invest in the food industry, ADM is an attractive option because it produces and supplies many of the world’s most consumed products, making it a good option for protecting a portfolio against recession impacts.
While the diversity of products offered by ADM adds to its appeal, it is also a great option for investors wanting to invest in the wheat industry without being solely dependent on it. With its long-standing growth and strong performance, ADM is a top option for food stocks.
2. Walmart (WMT)Copy link to section
Walmart is a top-pick food stock for investors seeking a safe haven during economic downturns. As the world’s largest retailer, it boasts an extensive network of hypermarkets, discount department stores, and grocery stores.
Walmart’s share price is one of the most stable of any food stock. While the S&P suffered a 35% loss in 2008, Walmart’s share price soared by over 30%. Since then, it has continued to climb, reaching its highest point ever in 2022. Walmart covers many bases and food products make up a large part of its revenue.
In times of recession, industries like consumer goods and essentials tend to thrive. Walmart offers not only in-store discounted groceries but also sells approximately 35 million items online each year. Its broad reach, expanding digital presence, and solid historical performance make it a top food stock.
3. Coca-Cola (KO)Copy link to section
Coca-Cola is a well-known company recognised globally and considered one of the most iconic brands in the world. It started as a small beverage company in Atlanta, Georgia, and has expanded to be an international brand with a presence in nearly every country. While Coca-Cola doesn’t focus on food, it still falls under the food and beverage sector.
Berkshire Hathaway, owned by Warren Buffet, is a significant shareholder in Coca-Cola, with over 400 million shares in the company. Buffet, known as one of the world’s best investors, has stated that he has no plans to sell his Coca-Cola stock.
Coca-Cola is part of the Dividend Aristocrats Club, a list of companies that have consistently raised dividends for at least 25 years. In 2020, even during difficult times, Coca-Cola prioritised increasing its dividend. This makes it an attractive stock for those seeking stable and reliable dividends from the food sector.
4. Mondelez International (MDLZ)Copy link to section
Mondelez is a US-based food company that operates in over 160 countries globally. Its portfolio includes well-known brands such as Côte d’Or, Halls, Philadelphia, Cadbury, Chips Ahoy!, Oreo, Ritz, and others. Despite its focus on snack brands, the growing trend towards health-conscious diets may pose a challenge for the company in the future.
Cost-cutting is a key priority for Mondelez, which has over 130 manufacturing facilities in over 40 countries. The strategic placement of these factories helps the company maintain a streamlined supply chain and keep costs low. This focus on efficiency has allowed Mondelez to remain competitive and maintain its financial stability.
In addition to its cost-cutting measures, Mondelez invests in product innovation and brand-building initiatives to ensure its continued growth and relevance in the food industry. The company’s commitment to innovation and efficiency, combined with its broad portfolio of famous brands, makes it a top choice for anyone wanting to invest in the food industry.
5. Beyond Meat (BYND)Copy link to section
Beyond Meat is a Los Angeles-based company specialising in plant-based meat substitutes for beef, chicken, and pork. Established in 2009, it quickly secured private investments and introduced its first product in 2012. It’s successful initial public offering in May 2019 valued the company at over $3 billion.
The potential for plant-based food is vast, with estimates of the accessible market exceeding $1 trillion. This presents ample opportunities for long term growth oriented investors. However, despite the rise in veganism, Beyond Meat’s stock has not kept pace and has fallen below its IPO price and over 90% below its all-time high following a series of disappointing earnings reports.
However, this downturn in the share price could be seen as a buying opportunity by astute investors. With its strong brand recognition and continued commitment to product innovation, Beyond Meat is well-positioned to capitalise on the growth potential of the plant-based food market. By investing at a “discount,” investors can benefit from future growth in the company’s share price.
Where to buy the best food stocksCopy link to section
You can buy any of the stocks listed on this page using the brokerage platforms below. Selected by our team of experts, these platforms are a top choice for beginners and experienced investors. Click on any link below to get started in just a few minutes.
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What is a food stock?Copy link to section
It’s the stock of a company that is involved in the food industry. This can include grocery stores, distributors, sellers, and agricultural businesses. Food stocks can be lucrative companies to invest in because food is a necessary commodity, essential for life and will always be in demand.
Are food stocks a good investment?Copy link to section
Yes, food stocks can be a good investment if you pick the right companies. Food is essential to life and will always be in demand. As the global population grows, the demand for food will only increase. This should help companies operating within the sector, although it is important to understand the type of business you’re investing in.
In recent years, there has been a slow shift towards healthier food and non-meat products, which you should consider when deciding. Businesses that rely heavily on snack type, or junk food may suffer if a healthier diet becomes more popular. That being said, many of the largest food companies are already diversifying their offerings to include more nutritious food.
The food industry is essential and expected to grow and investing in it now could be a good idea if you’re looking for growth from your stock investments. Whatever you decide to do, it’s a good idea to keep up to date with the latest news and market analysis, which you can do on any of the links below.
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