In this article, we will look at the 12 Best Household Stocks to Buy According to Hedge Funds.
Is There a Softening in the Consumer Staple Sector?
On March 21, Bryan Spillane, Bank of America Securities’ senior food and beverage analyst, appeared on CNBC’s ‘The Exchange’ to discuss things across his space and the trends surrounding consumer staples. He said that going through the first quarter of the year and having check-ins with companies has led him to conclude that the conditions in the sector have been soft, which is true across his entire coverage universe. Consumers are pulling back a bit, and there’s uncertainty surrounding the conditions in the sector. What’s surprising is that these trends started in January and extended through the first quarter.
The sector, however, is showing a dichotomy. Spillane believed this is a market for consumer staples, as we are looking for defensiveness and certainty. But at the same time, we are doing that at a time when the fundamentals appear to be decelerating. This creates a dynamic for investors to really understand the market and where it would be best to put their money in, as not all seem as safe as they would typically be.
READ ALSO: 10 Best Strong Buy Stocks To Buy Right Now and 10 Best Vegan Stocks to Buy According to Analysts.
The Biggest Challenge in Consumer Staples
According to Spillane, the biggest challenges right now are in the beverage alcohol sector specifically, which dropped off unexpectedly in the first quarter of this year after a weak fourth quarter last year. This can be attributed to visa issues, as cohorts of consumers are not spending as much as before. Similar trends are now materializing in household products and personal care categories as well. While these sectors have been very resilient over the past three years, they are now beginning to show signs of a slowdown. The conditions are a head-scratcher, because these are the products consumers use every day. Thus, general uncertainty around a cohort of consumers, including visa holders and students, is beginning to materialize in the sector’s performance.
These trends have resulted in concerns about whether staples would be less of a safe haven this time around. Addressing these concerns, Spillane said that staples would still be a safe haven if we consider them relative to the world we are living in. Large liquid consumer staples are still a place investors would want to be if they are looking for a place to hide in uncertainty, as they are likely to generate considerable cash flows and pay dividends.
With these reassuring trends in mind, let’s examine the 12 best household stocks to buy according to hedge funds.
A happy couple viewing the products of this household and personal product company in a mass merchandiser store.
Our Methodology
We sifted through stock screeners, financial media reports, and ETFs to compile a list of 20 household stocks. We then selected the top 12 with the highest number of hedge fund holders, as of Q4 2024, and ranked them in ascending order. We sourced the hedge fund sentiment data from Insider Monkey’s database.
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 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12 Best Household Stocks to Buy According to Hedge Funds
12. The Honest Company, Inc. (NASDAQ:HNST)
Number of Hedge Fund Holders: 25
The Honest Company, Inc. (NASDAQ:HNST) is a personal and household care company that provides non-toxic natural products, including home cleaning, diapers, health and wellness products, wipes, bath products, and skincare. It operates as an omnichannel brand that offers products through digital and retail channels. The company’s three product categories include household and wellness, diapers and wipes, and skin and personal care.
The Honest Company, Inc. (NASDAQ:HNST) reported positive results in 2024, hitting record revenue, gross margins, and adjusted EBITDA. It reported a revenue of $378 million, reflecting a 10% year-over-year growth. Its gross margins expanded 900 basis points to 38%. This was the highest annual revenue and gross margin ever for the company. It also delivered its first full year of positive adjusted EBITDA as a public company. The primary driver of this growth was its wipes category, which attained the No. 1 market position in natural wipes. The Honest Company, Inc. (NASDAQ:HNST) is continuing a strategic focus on its wipes, which is yielding promising results, driving repeat purchases, and expanding distribution.
In addition, the company is planning a significant strategic pivot by gradually moving away from its direct-to-consumer fulfillment operations to focus on more profitable retail and digital partnerships. With $75 million in cash and zero debt, The Honest Company, Inc. (NASDAQ:HNST) is in a solid position to continue its transformation strategy, which is why analysts are bullish on the stock. Its median price target of $5.02 implies an upside of 44.42% from current levels. In a report released on March 10, Aaron Grey from Alliance Global Partners maintained a Buy rating on the company with a price target of $8.00.
Meridian Contrarian Fund also expressed bullish sentiments for the stock, and stated the following regarding The Honest Company, Inc. (NASDAQ:HNST) in its Q4 2024 investor letter:
“The Honest Company, Inc. (NASDAQ:HNST) is a consumer products company focused on developing natural baby-care consumables, cosmetics, soaps, and other household supplies. The company went public in 2021, bolstered by pandemic-driven demand for its cleaning products. However, subsequent global supply chain challenges created headwinds for the smaller company, presenting a contrarian investment opportunity. We view the Honest brand as an authentic differentiator that has demonstrated growth despite operational challenges that previously impacted its earnings potential.
The company’s outperformance during the quarter and throughout 2024 was driven by sustained sales growth and notable improvements in gross margins, marking its first profitable year on an adjusted EBITDA basis. As Honest expands its product offerings in beauty categories aligned with consumer preferences for cleanly formulated skincare products—a segment we believe the company is well-positioned to succeed in—we remain optimistic about its long-term prospects. While we reduced our net shares held following the strong performance in the quarter, we maintain conviction in its growth potential.”
11. Helen of Troy Limited (NASDAQ:HELE)
Number of Hedge Fund Holders: 28
Helen of Troy Limited (NASDAQ:HELE) is a global consumer products company with an elaborate portfolio of brands, including Curlsmith, OXO, PUR, Hot Tools, Osprey, and more. It operates in the Beauty and Wellness and Home and Outdoor segments. The Beauty and Wellness segment offers beauty and wellness products, while the Home and Outdoor segment offers a range of consumer products for home activities.
The company continued to benefit from the meaningful net distribution gains it won in the first half of fiscal year 2025 and further expanded distribution in fiscal Q3 2025. It has grown its US weighted distribution by 11% year-over-year in fiscal year-to-date.
Canaccord Genuity analyst Susan Anderson maintained a Buy rating on the company on January 14 and set a price target of $92.00. She attributed her rating to various factors contributing to the company’s promising outlook. Helen of Troy Limited (NASDAQ:HELE) maintained strong earnings through improved gross margins despite a challenging cold season, demonstrating resilience. This was due to its focus on operational efficiencies and strategic growth initiatives that can be reinvested into brand development and innovation, according to the analyst. Helen of Troy Limited (NASDAQ:HELE) also announced the closing of its acquisition of Olive & June at the end of fiscal Q3 2025, which is expected to further support the company’s growth.
10. Nu Skin Enterprises, Inc. (NYSE:NUS)
Number of Hedge Fund Holders: 29
Nu Skin Enterprises, Inc. (NYSE:NUS) is an integrated wellness and beauty company that develops and markets an elaborate range of products in around 50 markets worldwide. It has three brands: Nu Skin, Pharmanex, and ageLOC. Nu Skin is a beauty brand, while Pharmanex and ageLOC are wellness and anti-aging brands, respectively.
On January 3, the company announced the completion of a strategic transaction between its Rhyz Inc. subsidiary and Later, a portfolio company of Summit Partners. Rhyz Inc. sold Mavely, its affiliate marketing technology platform, to Later for approximately $250 million cash and a minority equity stake in the combined Later/Mavely business. Mavely is anticipated to continue offering certain technology and social commerce abilities to support Nu Skin Enterprises, Inc.’s (NYSE:NUS) affiliate marketing business.
This strategic transaction gave the company around five times the return on its cumulative investments in Mavely since its acquisition in 2021. The proceeds from this transaction are expected to help Nu Skin Enterprises, Inc. (NYSE:NUS) fund innovation in its offerings and pay down debt. The company also plans to use its strengthened balance for share buybacks under its existing stock repurchase program, providing value to its shareholders.
The company also reported better-than-expected fiscal Q4 2024 earnings, with revenue reaching $445.6 million and adjusted EPS of $0.38. Despite foreign currency headwinds, Nu Skin Enterprises, Inc. (NYSE:NUS) expects strong 2025 earnings and revenue guidance. The company ranks tenth on our list of the 12 best household stocks to buy according to hedge funds.
9. Newell Brands Inc. (NASDAQ:NWL)
Number of Hedge Fund Holders: 29
Newell Brands, Inc. (NASDAQ:NWL) is a global consumer goods company that manufactures, markets, and sells consumer and commercial products. Its operations are divided into the Home and Commercial Solutions, Learning and Development, Outdoor and Recreation, and Corporate segments. The Home and Commercial Solutions segment offers a range of household products, including commercial cleaning and maintenance solutions, kitchen appliances, bakeware, hygiene systems, garage and closet organization products, and others.
Newell Brands, Inc. (NASDAQ:NWL) is on the path to recovery. It is on track with its turnaround strategy, with fiscal Q4 2024 marking its sixth consecutive quarter of improvement. Management is committed to returning to revenue growth in 2025. In the meantime, the company is GAAP profitable and pays a modest dividend. Newell Brands, Inc. (NASDAQ:NWL) is set to pay its shareholders a $0.07 dividend for every share as of February 28, payable on March 14.
The company’s supply chain reshoring strategy is also progressing, with minimal exposure to China outside its baby segment. Barclays analyst Lauren Lieberman maintained a Buy rating on Newell Brands, Inc. (NASDAQ:NWL) on March 11 and set a price target of $11.00. Its median price target of $6.45 implies an upside of 35.66% from current levels.
8. Unilever PLC (NYSE:UL)
Number of Hedge Fund Holders: 31
Unilever PLC (NYSE:UL) is a fast-moving consumer goods (FMCG) company that operates through five segments: Personal Care, Nutrition, Beauty and Well-Being, Home Care, and Ice Cream. Unilever PLC (NYSE:UL) offers over 400 brands worldwide. Its Beauty & Well-being segment includes skin care, hair care, and prestige beauty, while the Personal Care segment includes oral care products, deodorant, and skin cleansing. The Home Care segment manages fabric care and cleaning products, making it one of the best household stocks to buy according to hedge funds.
The company’s EPS slightly exceeded analyst consensus expectations of £2.965 in fiscal Q4 2024, reaching £2.98, primarily due to solid operational efficiency. However, revenue for the quarter reached £14.2 billion, missing the anticipated £15 billion. The revenue miss was primarily due to currency exchange headwinds and certain market challenges. Despite that, Unilever PLC (NYSE:UL) reported significant growth across its core brands, with its Power Brands collectively posting a 5.3% increase in underlying sales. The Beauty & Well-being segment underwent a 6.5% growth, while the Personal Care segment attained a 5.2% increase. This growth was attributed to a robust performance by brands such as Sunsilk and Vaseline in Beauty & Well-being and deodorant line innovations in Personal Care.
Thus, the company has a strong brand portfolio with high-profile names, which lends it a competitive market advantage and is critical to its long-term success. In a report released on March 18, Celine Pannuti CFA from J.P. Morgan maintained a Buy rating on the company with a price target of £54.00.
7. Spectrum Brands Holdings, Inc. (NYSE:SPB)
Number of Hedge Fund Holders: 38
Spectrum Brands Holdings, Inc. (NYSE:SPB) is a global manufacturer of branded home essentials and consumer products. It offers small household appliances, lawn and garden products, home pest control products, and others. The company manufactures, sells, and markets its products across Europe, the Middle East and Africa, North America, Latin America, and Asia-Pacific.
In Q1 2025, Spectrum Brands Holdings, Inc. (NYSE:SPB) reported a 1.2% growth in net sales, while organic sales grew by 1.9%. This growth was attributed to strategic investments in fiscal 2024 to enhance commercial operations and accelerate revenue growth. At the end of the quarter, the company had around $180 million in cash, with approximately $491 million available from its $500 million cash flow.
On February 7, Canaccord upgraded Spectrum Brands Holdings, Inc. (NYSE:SPB) to Buy from Hold with a price target of $102, up from $94. In a research note to investors, the analyst said that while the quarter and guidance “were nothing to write home about, they also weren’t the disaster that the stock’s recent performance suggests.” The firm believes that the company will buy back stock aggressively at current levels, providing a floor to the stock. It ranks seventh on our list of the 12 best household stocks to buy according to hedge funds.
6. Church & Dwight Co., Inc. (NYSE:CHD)
Number of Hedge Fund Holders: 38
Church & Dwight Co., Inc. (NYSE:CHD) manufactures, develops, and markets a range of personal care, consumer household, and specialty products. The company operates in the Consumer Domestic, Consumer International, and Specialty Products Division (SPD) segments. The Consumer Domestic segment offers household products, while the Consumer International segment offers personal care, household, and over-the-counter products in international subsidiary markets.
Church & Dwight Co., Inc. (NYSE:CHD) exceeded its sales growth outlook in fiscal Q4 2024, reporting a 4.1% net sales increase in fiscal year 2024 compared to the company’s outlook of around 3.5%. It drove strong consumer demand across its geographies and portfolios in fiscal year 2024, with organic sales increasing by 4.6%. The primary driver of organic growth was volume, which Church & Dwight Co., Inc. (NYSE:CHD) expects to continue in fiscal year 2025.
These positive results reflect the strength of the company’s brands, the success of its new and innovative products, and the benefits of its continued focus on execution. The company also reported strong cash flow generation, with over $1.1 billion of cash from operations in fiscal year 2024. This growth was attributed to margin expansion, strong sales, and efficient working capital management.
On February 21, Analyst Christopher Carey of Wells Fargo maintained a Buy rating on Church & Dwight Co., Inc. (NYSE:CHD), reducing the price target to $115.00. He gave the company a Buy rating due to its strong market position and its demonstration of robust consumption trends. In addition, the company’s strategic investments and innovations, proactive engagement in mergers and acquisitions, and healthy cash reserves are anticipated to drive future growth, according to the analyst. In another report released on February 5, Argus Research analyst Taylor Conrad also reiterated a Buy rating on the company.
5. Kenvue Inc. (NYSE:KVUE)
Number of Hedge Fund Holders: 38
Kenvue Inc. (NYSE:KVUE) is a consumer health company that operates through three segments: Skin Health and Beauty, Self Care, and Essential Health. Its Skin Health and Beauty segment offers hair care, body care, face care, and other product categories. The Essential Health segment comprises baby care, women’s health, oral care, and more. The company’s global footprint spans more than 165 countries across its four regions.
The company reported adjusted earnings per share (EPS) of $0.26 in fiscal Q4 2024, in line with analyst expectations. Although the company faced some headwinds, it managed to improve its operating income margins and gross profit year-over-year, reflecting operational efficiency gains.
Kenvue Inc. (NYSE:KVUE) owns popular brands such as Tylenol and Listerine and maintains its competitive edge through continuous innovation and strong brand recognition. It has recently focused on improving its brand investments and implementing operational efficiencies to boost growth.
The company operates globally, and its relationship with Johnson & Johnson, its parent company, reinforces its market standing by supporting its research capabilities and supply chain. On March 5, Canaccord raised Kenvue Inc.’s (NYSE:KVUE) price target to $29 from $24, keeping a Buy rating on the shares. The firm raised its price target because of the strong cold/flu season, as the increased illness incidence rates for cough/cold/flu may lead to an unplanned replenishment opportunity.
4. Kimberly-Clark Corporation (NYSE:KMB)
Number of Hedge Fund Holders: 50
Kimberly-Clark Corporation (NYSE:KMB) manufactures and markets a range of products by employing advanced technologies in absorbency, nonwovens, and fibers. It operates in three segments: the Personal Care segment, the Consumer Tissue segment, and the K-C Professional segment. It sells its products under various brands, including Kleenex, Scott, Cottonelle, DryNites, Huggies, and others. Kimberly-Clark Corporation (NYSE:KMB) is accelerating investments to build its brands, powerhouse categories, and innovative pipeline.
In fiscal Q4 2024, Kimberly-Clark Corporation (NYSE:KMB) reported revenue of $4.9 billion, exceeding analyst estimates of $4.85 billion by 1.5%. Despite challenges from foreign currency fluctuations and strategic divestitures, the company demonstrated revenue resilience, supported by a 2.3% rise in organic sales.
Kimberly-Clark Corporation (NYSE:KMB) generated an operating cash flow of $3.2 billion in the full year 2024 and paid $2.6 billion to shareholders through dividends and share repurchases. On January 28, the company declared a 3.3% hike in its quarterly dividend to $1.26 per share, marking its 52nd consecutive year of dividend growth.
In a report released on March 19, Bryan Spillane from Bank of America Securities reiterated a Buy rating on Kimberly-Clark Corporation (NYSE:KMB) with a price target of $160.00. The company takes the fourth spot on our list of the 12 best household stocks to buy now.
3. The Clorox Company (NYSE:CLX)
Number of Hedge Fund Holders: 54
The Clorox Company (NYSE:CLX) is a multinational marketer and professional and consumer goods manufacturer. It operates through four segments: Household, Health and Wellness, Lifestyle, and International. The Health and Wellness segment comprises cleaning, disinfecting, and professional products sold and marketed under various brands. The company’s International segment comprises products sold outside the US, and includes products such as laundry additives, home care products, and more.
By investing in top brands, The Clorox Company (NYSE:CLX) has been focused on margin improvement instead of revenue growth. Fiscal Q2 2025 marked the ninth consecutive quarter of gross margin expansion for the company. For the full fiscal year, it is anticipating organic sales growth of around 3% to 5% and gross margin expansion of 125 to 150 basis points.
The Clorox Company (NYSE:CLX) expects increased advertising in H2 2025 compared to H1. This aggressive promotion and advertising spending, even during a period of increased expenses, reflects the company’s confidence in its new product launches and robust brand portfolio. The company has a 3.3% dividend yield and has had 40 consecutive years of dividend raises.
2. Colgate-Palmolive Company (NYSE:CL)
Number of Hedge Fund Holders: 62
Colgate-Palmolive Company (NYSE:CL) manufactures and sells various products for the personal and home care markets and operates in two product segments: Oral, Personal, and Home Care, and Pet Nutrition. The Oral, Personal, and Home Care segment sells cleaning products worldwide. Its brand portfolio includes several reputable brands, including Colgate, Palmolive, Irish Spring, Sorriso, Protex, meridol, Axion, Sanex, and others.
The company reported strong operational results in fiscal Q4 2024, with gross margin rising 70 basis points to 60.3%. Colgate-Palmolive Company (NYSE:CL) also maintained its dominant position in the global toothpaste market with 41.4% and manual toothbrushes with 32.2% global market share.
On March 20, the company raised its quarterly common stock cash dividend to 52c per share, up from 50c per share, effective in H2 2025. The company has been paying uninterrupted dividends on its common stock since 1895. On March 14, JPMorgan analyst Andrea Teixeira raised the firm’s price target on Colgate-Palmolive Company (NYSE:CL) to $99 from $97 and kept an Overweight rating on the shares.
Diamond Hill Large Cap Strategy also expressed bullish sentiments on the stock, and stated the following regarding Colgate-Palmolive Company (NYSE:CL) in its Q4 2024 investor letter:
“As valuations have continued rising and the economic cycle has gotten relatively long in the tooth, we’ve thought carefully about where and how we are exposed to more cyclical stocks. As such, we initiated just two new positions in Q4: Colgate-Palmolive Company (NYSE:CL) and the aforementioned Lululemon.
Colgate-Palmolive is a high-quality business with leading positions in oral care, home products and pet nutrition. Historically, the company has allocated capital well, and it produces significant free cash flows. Shares were pressured in Q4 primarily, we believe, in sympathy with near-term macroeconomic concerns rather than any fundamental issues at the business. We consequently capitalized on the underperformance and compelling valuation to start a position.”
1. The Procter & Gamble Company (NYSE:PG)
Number of Hedge Fund Holders: 79
The Procter & Gamble Company (NYSE:PG) provides branded consumer packaged goods to consumers across the globe. Its operations are divided into Fabric & Home Care, Grooming, Beauty, Health Care, Feminine & Family Care, and Baby. The company boasts a strong portfolio of brands, which includes reputable names such as Head & Shoulders, Pantene, Old Spice, Olay, Herbal Essences, Safeguard, Tide, Always, Venus, Oral-B, Ariel, Crest, Tampax, and others.
The Procter & Gamble Company (NYSE:PG) sells its products in around 180 countries and territories. The company operates a long list of industry-leading brands across key consumer staples categories, which lends it a significant competitive advantage. Over the last decade, it has returned around $147.8 billion to shareholders: $67.9 billion through share buybacks and $79.9 billion via dividends. This reflects its strong model of operation.
The Procter & Gamble Company (NYSE:PG) has a strong innovation pipeline and is leveraging AI and advanced technologies to optimize media buying, advertising development, and supply chain operations. The Wall Street Journal’s Natasha Khan and Sharon Terlep report showed that the company overtook Unilever by focusing on its largest brands and improving their efficacy. The Procter & Gamble Company (NYSE:PG) is in the strongest position to weather a turbulent year among its competitors, according to the report. On March 17, Erste Group analyst Stephan Lingnau upgraded the company to Buy from Hold and reiterated its growth forecast, expected annual earnings per share, and anticipated sales growth of around 2% to 4%. According to Erste, the stock is attractively valued compared to the sector.
Overall, PG ranks first among the 12 best household stocks to buy according to hedge funds. While we acknowledge the potential of household stocks, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. Insider Monkey focuses on uncovering the best investment ideas of hedge funds and insiders. Please subscribe to our free daily e-newsletter to get the latest investment ideas from hedge funds’ investor letters by entering your email address below.
