There's a great deal to be said for blue-chip consumer staples stocks with solid balance sheets and a reliable stream of dividends. After all, even in a downturn consumers need things like toothpaste, bleach, trash bags, cereals and snacks.

That gives Colgate-Palmolive (CL), Clorox (CLX) and Kellogg (K) some nice defensive characteristics, but second-quarter results have thus far suggested that the sector is struggling to grow revenue in the face of deflationary forces.

Recent weakness might just make these stocks compellingly valued, especially in light of their generous dividends. On the other hand, these shares could be poised to stagnate -- or worse -- after outperforming the broader market for the better part of a year.

For more on the bull and bear cases on Colgate, Clorox and Kellogg, see the video below:

Increase your money and finance knowledge from home

Understanding Stock Market Indexes

What does it mean when people say "the market is up 2%"?

View Course »

Introduction to Preferred Shares

Learn the difference between preferred and common shares.

View Course »

Add a Comment

*0 / 3000 Character Maximum