In this article, we will discuss: 10 Best Household and Personal Care Stocks to Buy.
According to Grand View Research, the global market for beauty and personal care products is projected to increase at a CAGR of 7.7% from 2024 to 2030. The market was valued at $557.24 billion in 2023. Growing customer awareness of appearance is one of the main forces propelling market progress. In terms of type, in 2023 the conventional beauty and personal care market held the highest revenue share of 84.6%. Last year, the skincare segment brought in 33.7% of the total revenue from the beauty and personal care products market, while the market for haircare products is anticipated to expand between 2024 and 2030 at a CAGR of more than 8.1%. Regionally, the Asia Pacific beauty and personal care products market dominated the global market in 2023, accounting for 39.3% of total revenue, and is predicted to rise at a CAGR of approximately 9% from 2024 to 2030 as per the research.
Specifically, the market for personal care products in the United States was estimated to be around $73.17 billion in 2023 and is anticipated to grow at a CAGR of 6.1% between 2024 and 2030. The primary driver of the personal care products market’s expansion in the United States is the country’s aging population. The number of Americans 65 and older increased from 49.2 million in 2016 to 57.8 million in 2022, according to the US Census Bureau. In 2022, they made up 17.3% of the entire population. These individuals are primarily interested in healthcare products that help them retain a youthful appearance.
The purpose of regulations in the market for beauty and personal care goods is to guarantee product efficacy and consumer safety. Government organizations that regulate the industry, such as the European Commission in the European Union and the Food and Drug Administration (FDA) in the United States, set standards for product ingredients, labeling, and advertising.
On the other hand, Expert Market Research estimates that the global market for household care was valued at $106.40 billion in 2023. In order to reach a value of approximately $148.01 billion by 2032, the market is anticipated to grow at a CAGR of 3.7% during the forecast period of 2024-2032, according to the research. The market is being driven by a growing focus on cleanliness and health care, a growing popularity of washing machines, and the rising demand for household care goods like laundry detergents. In addition, the market’s primary regions include Europe, Asia Pacific, North America, Latin America, the Middle East, and Africa.
According to Deloitte’s 2024 consumer products industry outlook, as growing prices hit their limit in an unstable economy, the consumer products industry is predicted to shift from price-taking strategies to concentrating on “profitable volume” in 2024. Businesses that have performed well recently have demonstrated increased revenue and improved return on assets (ROA) by striking a balance between pricing power, innovation, and supply chain efficiency. The profitable expansion will depend on increasing volume while improving the product mix and holding onto as much pricing power as is practical, as additional price increases will encounter resistance from both retailers and cost-conscious consumers.
Advantageous mergers and acquisitions, strategic innovation, targeted advertising, and precision revenue growth management will be important strategies. Improved supply chain management and operational effectiveness are also essential. The consumer product executives Deloitte surveyed are cautious about maintaining volume and margin expansion in a difficult geopolitical climate, even with a positive outlook. It will be up to leaders to manage new and developing rules like the Corporate Sustainability Reporting Directive, GLP-1 weight-loss drugs, and generative AI.
With that said, here are the 10 Best Household and Personal Care Stocks to Buy.
A supermarket aisle filled with Household and Personal Care Products.
Methodology:
We sifted through holdings of household and personal care ETFs and online rankings to form an initial list of 20 household and personal care stocks. Then we selected the 10 stocks that were the most popular among institutional investors. The stocks are ranked in ascending order of the number of hedge funds that have stakes in them, as of Q2 2024. We have used the stock’s market cap as a tie-breaker in case two or more stocks have the same number of hedge funds invested.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points. (see more details here)
10. Helen of Troy Limited (NASDAQ:HELE)
Number of Hedge Fund Investors: 21
Market capitalization as of September 12: $1.24 billion
Helen of Troy Limited (NASDAQ:HELE) is a consumer products firm with a diverse portfolio of brands that it uses to provide its clients with innovative products and solutions. Its operations are divided into two segments: the Home & Outdoor segment offers a wide range of consumer goods for tasks around the house like organizing, cooking, cleaning, and food preparation; it also offers goods for outdoor and mobile activities like hydration, food storage, backpacks, and travel gear. The Beauty & Wellness segment offers products for beauty and wellness like prestige and mass-market beauty appliances, prestige market liquid-based hair, and personal care products.
Consumer goods are offered by the company across the U.S., Europe, the Middle East, Africa, Asia Pacific, and Latin America.
Susan Anderson, an analyst at Canaccord Genuity, kept Helen of Troy Limited (NASDAQ:HELE) at a Buy rating with a price objective of $84. Its Project Pegasus, which intends to save $75 million to $85 million annually while improving operating efficiency and profitability by FY26, is the main driver of Anderson’s optimistic forecast. In the competitive market, Helen of Troy’s pledge to reinvest these savings in innovation and brand development is essential. Furthermore, the firm’s potential asset sales, capital allocation plan, and robust free cash flow offer flexibility for upcoming mergers and acquisitions, reinvestment, and share repurchases. These elements uphold Anderson’s Buy rating despite the present problems with consumer spending.
The Helen of Troy’s emphasis on cutting expenses and positive free cash flow production points to a strong possibility for future stock price growth.
Ken Fisher’s Fisher Asset Management is the largest shareholder in the firm, with 416,973 shares worth $38,67 million.
9. Unilever PLC (NYSE:UL)
Number of Hedge Fund Investors: 21
Market capitalization as of September 12: $161.06 billion
Among the many household and personal care brands owned by Unilever PLC (NYSE:UL), one of the “Biggest Cosmetics Brands in the World, are the well-known names Dove, Vaseline, and Magnum Ice Cream found in supermarkets and pharmacies. The company intends to spin off its ice cream business, which includes Ben & Jerry’s and Magnum, by the end of 2025.
Compared to its rivals, Unilever is often more active when it comes to acquiring and selling companies businesses. The firm bought Seventh Generation, a line of eco-friendly cleaning goods, and the direct-to-consumer Dollar Shave Club in 2016. In 2022, it sold off its global tea business, which included Lipton , and is currently targeting acquisitions in the plant-based foods industry. Other recent noteworthy acquisitions include Horlicks, Paula’s Choice, Liquid I.V., Garancia, and The Vegetarian Butcher.
Tens of billions of dollars are made by Unilever PLC (NYSE:UL), one of the major global companies in the cosmetics industry. Despite being a defensive stock for customers, it also benefits from significant funding that allows it to investigate cutting-edge cosmetic solutions.
In Q1 2024, the underlying sales of the Beauty & Wellbeing division increased by 7.4% YoY. The segment’s volume grew 5.6% YoY, mostly as a result of Prestige Beauty and Health & Wellbeing experiencing double-digit growth. Despite a particularly strong prior year comparison, Personal Care growth was 4.8% YoY, with volume up 1.4% YoY.
Unilever and Accenture have extended their strategic alliance in an effort to streamline UL’s digital core and use generative AI to increase productivity and business agility.
The firm’s exceptional development prospects, which include an expected 4.6% organic CAGR from 2024-2027 and a 10% EPS CAGR from 2023-2026, are highlighted by Bank of America’s twofold upgrading of UL to “Buy.” The focus that it places on innovation and “power brands” in its strategy, along with the expectation that its Ice Cream division will be separated by 2025, will improve the company’s focus on higher-growth categories, all of which serve to reinforce its market positioning. With a revised price target of 5,600p, there is a predicted 19% upside potential, suggesting that the current turnaround is gathering steam.
Ken Fisher’s Fisher Asset Management is the largest shareholder in the firm, with 15,612,223 shares worth $858.52 million.
8. Newell Brands Inc. (NASDAQ:NWL)
Number of Hedge Fund Investors: 24
American multinational consumer goods firm Newell Brands Inc. (NASDAQ:NWL) operations are organized into three segments: Outdoor and Recreation, Learning and Development, and Home and Commercial Solutions.
The Commercial Solutions segment offers products under the following brands: Rubbermaid, Rubbermaid Commercial Products, Mapa, and Spontex; closet and garage organization; hygiene systems and material handling solutions; small appliances under the Breville brand in Europe; Kitchen appliances under the Crockpot, Mr. Coffee, Oster, and Sunbeam brands; food and home storage products under the FoodSaver, Rubbermaid, Ball, and Sistema brands; vacuum sealing products; gourmet cookware, bakeware, and cutlery under the Calphalon brand; and home fragrance products under the WoodWick and Yankee Candle brands. The company also offers personal care products for babies.
Although Q2 revenue from Newell Brands was somewhat less than the $2.05 billion consensus, the company nevertheless managed to increase operating profits and gross margins significantly. Despite a difficult macroeconomic climate, the company’s Chief Financial Officer cited effective strategic execution, higher advertising spending, and decreased leverage as factors that contributed to a more positive financial picture.
Wells Fargo maintained an Equal Weight rating on the shares of the firm and increased the firm’s price objective from $6 to $9. The company reports that after more cautionary data points, a positional unwind was sparked by improved overall results and a minor profit increase, which caused shares to jump by over 40.5%, leading to a raised full-year outlook for 2024.
Overall, the Newell Brands Inc. (NASDAQ:NWL)’s emphasis on its top-performing brands, operational effectiveness, and strategies for improving margins are producing encouraging outcomes going forward.
Richard S. Pzena’s Pzena Investment Management is the largest shareholder in the company, with 52,479,058 shares worth $336.39 million.
7. Spectrum Brands Holdings, Inc. (NYSE:SPB)
Number of Hedge Fund Investors: 30
Spectrum Brands Holdings, Inc. (NYSE:SPB) manufactures and distributes consumer products and home essentials. The company is divided into three segments: Home and Garden (H&G), Global Pet Care (GPC), and Home and Personal Care (HPC). The home and garden, cleaning supplies, and insect control industries are all included in the H&G section. The market for small kitchen and personal hygiene appliances is included in the HPC segment.
The Home and Personal Care segment offers home appliances under the names Black & Decker, Russell Hobbs, George Foreman, PowerXL, Emeril Legasse, Copper Chef, Toastmaster, Juiceman, Farberware, and Breadman, as well as personal care goods under the Remington brand.
It manufactures, sells, and ships its products to Europe, the Middle East, Africa, Latin America, and North America.
The company reported revenue of $779.4 million for the third quarter of 2024, which was 6% YoY higher than the consensus estimate of $755.33 million. CEO David Maura reports that favorable year-to-date net sales growth is the result of strong operating momentum across all divisions. From the prior year, the gross margin climbed by 310 basis points to 38.9%. Adjusted EBITDA, which excludes investment income, was $93.6 million following a $23 million investment in brand and innovation. Net income rose to $191.3 million YoY. After deducting investment income, adjusted EBITDA margins came in at 12.0%, while net income margins increased by 2.5% annually. The company now forecasts adjusted EBITDA growth of about 20% for the whole year.
Brian McNamara of Canaccord Genuity boosted the price target to $91, although he maintained his Hold rating on Spectrum Brands. Despite strong Q3 sales and e-commerce growth, the Hold rating was given because of concerns about diminishing margins and the need for ongoing sales growth. Although the firm’s revised adjusted EBITDA estimate is encouraging, the analyst still sees issues with future profitability.
Spectrum Brands Holdings, Inc. (NYSE:SPB) is nevertheless in good financial standing and is one of the most prominent players in the household and personal care market.
6. Church & Dwight Co., Inc. (NYSE:CHD)
Number of Hedge Fund Investors: 36
Church & Dwight Co., Inc. (NYSE:CHD) is the biggest producer of baking soda in the world. In addition to baking soda, its product line consists of items like Batiste, OxiClean, Vitafusion, WaterPik, Hero, and TheraBreath that are appealing to a wide range of consumers. About 70% of the company’s yearly revenues and profits come from these brands plus Arm & Hammer.
Despite its efforts to increase the market for its products, the company still gets more than 80% of its sales from its home market in the United States.
Despite being smaller than many of its competitors, the firm has produced a solid return on capital without deviating from its primary areas of personal care and home products.
During the pandemic, sales for several of the Church & Dwight Co., Inc. (NYSE:CHD)’s products climbed, making its product portfolio one of the most stable in the industry. The company’s well-known brands, like Arm & Hammer, now provide a wider range of items.
It saw a 5.3% year-over-year growth in its organic sales last year (revenue not derived from acquisitions), and it anticipates growing at a rate of 4% to 5% in 2024. The company estimates that it will have a 7%-9% growth in earnings per share in 2024.
The company’s excellent product launches, growth in market share across several categories, and solid international performance all contributed to the outstanding results in the recent Q2 2024.
TD Cowen analyst Robert Moskow maintained a Buy recommendation on the Church & Dwight Co., Inc. (NYSE:CHD) with a $114 price objective. Moskow praised the strong Q2 results, which exceeded sales and EPS projections. Despite a pessimistic view for the second half of 2024 due to softening category trends, CHD has a competitive edge because of its better gross margin, rise in organic sales, and gains in market share in some categories. Moskow expects steady growth with a balanced portfolio of luxury and value products, with 21% of sales coming from digital channels. He is additionally hopeful that the household and personal care products company will hit the higher end of its EPS target and underline the potential for more margin growth.
Terry Smith’s Fundsmith LLP is the largest shareholder in the company, with 6,914,366 shares worth $716.88 million.
5. The Clorox Company (NYSE:CLX)
Number of Hedge Fund Investors: 38
The Clorox Company (NYSE:CLX) is another household product and personal care company with a number of brands that can deliver outcomes in good times and bad. The firm has expanded to compete in a number of consumer product categories since its founding more than a century ago, including cleaning supplies, laundry care, trash bags, cat litter, charcoal, food dressings, water-filtration products, and natural personal care items.
Apart from its namesake brand, the company’s portfolio includes Liquid-Plumr, Pine-Sol, S.O.S, Tilex, Kingsford, Fresh Step, Glad, Hidden Valley, KC Masterpiece, Brita, and Burt’s Bees. Less than 85% of Clorox’s revenues occur within its home country.
The results of Clorox’s efforts to mitigate the effects of severe inflationary headwinds and supply chain unrest were overshadowed when, in mid-August 2023, a cybersecurity attack compelled it to take certain IT systems, including ordering offline. Even though this initially hampered sales and profitability, analysts do not believe the company’s competitive advantage has diminished. Conversely, they believe that its well-established relationship with retailers will allow it to gradually regain its shelf position, much like its inventory recovery after the pandemic.
Revenue dropped by 5.75% in the company’s fiscal 2024, which concluded in June 2024, but it was still able to deliver strong profit growth due to lower manufacturing and logistics costs and cost-saving initiatives. Long-term, The Clorox Company (NYSE:CLX)’s “IGNITE” strategy concentrates on accelerating long-term development through innovation, cost savings, and portfolio expansion.
Ken Griffin’s Citadel Investment Group is the largest shareholder in the company, with 2,830,472 shares worth $386.27 million.
