Defensive stocks are surging as investors have been shifting their focus. Growth stocks dominated the past two years. Now, slower economic signals and rising risks are changing the landscape due to market uncertainty.
Defensive stocks offer much more stability and tend to perform well even in tough times. People still need electricity, medicine, and food. That reliability draws investors when uncertainty grows.
Many are rotating into these stocks for safety. The surge suggests a broader trend. It could mark a turning point after years of growth-led rallies., so it’s worth looking into the defensive stocks that stand out right now.
A retail employee stocking shelves with consumer packaged goods/manufacturing products.
Methodology
For this article, I screened the best-performing defensive stocks year-to-date.
I will also mention the number of hedge fund investors in these stocks. 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).
15. Albertsons Companies Inc (NYSE:ACI)
Number of Hedge Fund Holders In Q4 2024: 70
Albertsons Companies Inc (NYSE:ACI) is one of the biggest food and drug retail chains.
The stock is up significantly so far in 2025 due to multiple analysts upgrading the stock as it is defensive in nature. Many investors are rotating into defensive stocks, and ACI is one of the top picks among smaller defensive companies.
On February 19, 2025, Albertsons announced a $600 million senior notes offering at a lower interest rate of 6.25%, replacing its existing 7.5% notes due in 2026. This move is expected to reduce interest expenses and improve financial flexibility.
Albertsons has been investing heavily in digital transformation and operational efficiency. A notable partnership with TransUnion in January 2025 aims to enhance its advertising capabilities.
The consensus price target of $23.5 implies 6.75% upside.
ACI stock is up 12.97% year-to-date.
14. Adecoagro SA (NYSE:AGRO)
Number of Hedge Fund Holders In Q4 2024: 17
Adecoagro SA (NYSE:AGRO) is a South African agro-industrial company that makes agricultural commodities.
The stock is up significantly so far in 2025 due to ongoing discussions with Tether Investments for a potential acquisition. Tether proposed a tender offer to acquire 51% of Adecoagro’s outstanding shares at $12.41 per share.
Adecoagro reported better-than-expected earnings for Q4 2024, with an EPS of $0.4585, beating forecasts by 12.2%, and revenue of $368.51 million. This exceeded expectations by nearly $20 million.
The performance was driven by record sugar and ethanol production. This contributed to a consolidated adjusted EBITDA of $444 million for the year.
The company achieved operational records in sugarcane crushing and sugar production despite challenging weather conditions. It distributed $102 million to shareholders in 2024 through dividends and share repurchases. It also invested $104.1 million in expansion CapEx projects last year.
The consensus price target of $12.63 implies 17.07% upside.
AGRO stock is up 14.42% year-to-date.