Why We're Not Chasing Consumer Staples

By Lori Calvasina
Published May 27, 2022 | 9 min listen

This week in the podcast, we dig into Consumer Staples, the third best performing sector in the S&P 500 so far in 2022.

Disclosures and Disclaimers

The big thing you need to know: We are sticking with a market weight stance on the sector. The tailwinds that have boosted sector performance so far this year (a favorable macro backdrop for defensives, rising recession fears, strong money flows, and a higher quality profile than other defensives) may continue to support leadership in the sector in the near term. But our list of concerns on the sector is growing, and includes extremely problematic valuations, crowded positioning, earnings revisions risk, a weaker ESG profile, and a cautious outlook from our analyst team. On a 6-12 month view, we think staying neutral makes the most sense and we’re reluctant to chase.

View audio transcript

Lori Calvasina

Lori Calvasina
Managing Director & Head of U.S. Equity Strategy, RBC Capital Markets

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