The global food industry is growing fast, with an estimated market value of 12 trillion in 2022. This growth is driven by various factors such as technology, increased demand for food, a growing global population, and the changing focus on practices about sustainability. The industry is also witnessing a rise and creation of new companies in different specialty areas such as farming, technology, advisory, logistics, and other specializations.
Due to the increasing expansion, increased profitability, and predicted future growth, the food industry is one of the areas you should invest your money by buying stocks. However, not all stocks will be profitable, and you should be cautious about getting the right stock to increase profitability. Here are some food industry stocks you should watch out for since they indicate positive prospects.
1. General Mills
The best stock to buy is one that is owned by a group company which is a company with various subsidiaries in different fields. This increases the profitability chances since a fairly or loss in one subsidiary can be replaced by another.
General Mills is one of the companies currently having much influence in the food market and industry. It owns subsidiaries such as Pillsbury, Cheerios, Häagen-Dazs, Progresso, Green Giant, Yoplait, and many more. The company prides itself in offering organic foods and delivering meals to your doorstep. The increased focus on home delivery made it one of the fastest-growing stocks, especially during the Covid-19 period. Ever since the stocks have remained high and continue growing.
In the future, most consumers will focus on organic foods and products, shifting from fast foods to GMOs. This gives the stock positive future growth prospects since it already raises more revenue from its organic food portfolio. The company is also increasing its diversification to other areas, such as the pet industry, by manufacturing pet soy products. According to U.S Soy News, the demand for soy products for pets which is a source of animal protein and human food continues to rise, increasing future profit predictions. U.S. Soy has caught up to many different industries as they make strides toward the development of innovative soy products through sustainable farming.
2. PepsiCo
The beverage brand is one of the leading beverage companies in the United States; the other profitability factor is its global presence and operation, which gives it access to a wide international market. The company is also extending to other foods through acquisition and currently has a snack portfolio consisting of Lay’s, Doritos, Quaker Oats, and Cheetos.
Despite being a little expensive, the company enjoys a loyal customer base that is not bothered by the prices. Its revenue from the organic products portfolio is rising to complement other revenues from other sources. You should invest in the stocks due to the future growth rates, positive reputation and consumer preference. The brand will also likely increase its portfolio, expand into new markets, and maintain profitability.
3. Tyson Foods
The demand for meat is rising globally since it is the number source and most reliable form of protein. This means that companies dealing in meat production are bound to experience exponential growth in the future. In most countries, a few companies control meat processing and production, making the existing players more profitable. Therefore, if you want to buy a profitable stock, you should consider the Tyson food stock.
The company is also expanding to other proteins by promoting chicken farming and pig to increase protein alternatives available to consumers. Meat also remains a staple diet in countries such as America; hence the demand remains high and sometimes slightly exceeds the supply. In 2022, the company had revenue of $54 billion and was predicted to grow in the future.
4. Kroger Co
Food retailers have ever-growing stocks; hence you can invest in them and wait for the stock to continue rising. One of the fastest-growing food retailers in the US is Kroger CO; hence the stocks are likely to grow, especially due to its future growth perspectives and strategies.
The brand plans to launch new services, such as a digital marketplace to offer online deliveries. It currently partners with online companies such as Mirake to boost the digital service offered to the people. It is also expanding into business-to-business marketplaces to provide food delivery services to other food businesses, such as restaurants. Currently costing about $50, the stock has been growing fast over time and is estimated to be $100 in the next five to seven years.
5. Mondelez International
This is another group company; however, it is more ideal than other options due to its international presence and global operations in over 150 countries. You can buy these stocks and ensure profitability from the worldwide market. The company owns subsidiaries such as Cadbury, and Chips Ahoy! Oreo, Philadelphia, Ritz, Wheat Thins, etc. Some of these companies are famous amongst consumers since they manufacture some of the most demanded foods and products.
The company is also diversifying its operations to focus on organic foods and snack options. Despite facing some challenges in other countries due to political, civil, and war instabilities, the losses can easily be compensated by profits from other countries. For instance, despite the challenges in Ukraine, it did not record any losses because of its global presence and revenue.
6. Amazon
Amazon Inc. may not be a direct food company; however, it has a significant investment in the food business and has subsidiaries such as wholefoods. Buying Amazon stocks enables you to invest in whole foods, especially as Amazon prepares to diversify its food and agriculture industry. Amazon currently includes food businesses and deliveries as part of Amazon prime services.
The company is also implementing various technologies to boost food preservation. Whole foods are also increasing its product portfolio and expanding to new areas, such as pet foods. Whole foods will always remain profitable since it can tap into Amazon customers, increasing its potential customer base. The customer base enables Amazon stocks also to rise. Amazon is also expanding into other food delivery services that are not a part of Whole Foods’ portfolio. For instance, it deals in nearly all snacks the consumer may need.
Conclusion
Before you buy any stock, you should focus on brand profitability factors by focusing on aspects such as portfolio, global presence, demand, expansion, and diversification. You should also focus on the company and monitor its historical revenue growth. You can invest in specific sectors or general companies with subsidiaries in other sectors, such as food technology.