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4 Best Grocery Stocks to Add to Your Portfolio in April 2022

When you think of the basic items that every family needs: household items, food, drinks, hygiene products and other items that we cannot do without, no matter what is happening in the world and whatever the inflation, grocery store inventory may come to mind.

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Goldman Sachs (NYSE:GS) foresees a 6% increase in food prices and an increase in the costs of certain agricultural inputs. Grocery prices in the Consumer Price Index have increased 11% over the past two years.

Why Buy Grocery Stock? Consumer staples may maintain a steady presence as other market sectors suffer. Let’s take a look at why you might want to buy them and three stocks to choose from this month.

Why buy grocery stocks?

Consumer staples, including grocery stocks, can boost portfolio diversification, provide steady growth, give you solid dividends and low volatility. Grocery stocks provide a natural built-in defense against the bear market due to high demand. Currently inflated grocery prices mean you can also capitalize on costs passed on to consumers. Look for grocery stocks with competitive advantages over competitors and growth-oriented trajectories.

4 grocery stocks to boost your wallet

So which grocery stocks would you like to add to your portfolio? Let’s throw four options in the hat so you can see if they might work for you.

Albertsons Companies Inc. (NYSE:ACI)

Albertsons Companies Inc., headquartered in Boise, Idaho, operates grocery stores and pharmacies that offer groceries, general merchandise, health and beauty care products, drugstores, fuel and other services. The company operates more than 2,000 stores, including the following:

  • Albertson
  • Safeway
  • Let’s
  • pavilions
  • Randall
  • Tom Thumb
  • Carrs
  • Bijou-Osco
  • Acme
  • Shaw’s
  • star market
  • United supermarkets
  • Market Street
  • haggen
  • Food markets of kings
  • Balducci gourmet market

The company operates more than 1,500 pharmacies, 1,200 branded in-store cafes, 400 adjacent gas stations, 22 distribution centers and 20 manufacturing plants.

In the third quarter of fiscal 2021, face-to-face sales increased 5.2% and digital sales increased 9%. On a two-year cumulative basis, the company saw digital sales growth of 234%. Net income was $425 million and adjusted net income was $457 million.

Net sales and other income were $16.7 billion in the 12 weeks ended Dec. 4, 2021, compared to $15.4 billion in 2020. The company said retail price inflation and COVID-19 vaccines had contributed to the increase.

Adjusted net income was $457.2 million in the third quarter of Fiscal 2021 compared to $386.6 million in the third quarter of Fiscal 2020. Adjusted EBITDA was 1,051.2 million, or 6.3% of sales, in the third quarter of Fiscal 2021, compared to $967.7 million, or 6.3% of sales, in the third quarter of Fiscal 2020.

Target Company (NYSE: TGT)

Target Corporation, headquartered in Minneapolis, Minnesota, operates and owns general merchandise stores across the country, including food assortments including perishables, dry groceries, dairy and frozen foods .

In the fourth quarter of 2021, Target Corporation’s comparable sales increased 8.9%, compared to 20.5% in the fourth quarter of 2020.

Target had total revenue of $106 billion in 2021, after growing nearly $28 billion, or more than 35%, over the past two years. Full-year comparable sales increased 12.7% compared to 19.3% in 2020.

Target’s total sales have increased by more than $27 billion since 2019, representing $14 billion in additional in-store sales and digital sales growth of nearly $13 billion. All five major merchandise categories saw double-digit comparable sales growth in 2021.

Costco Wholesale Corporation (NASDAQ: COST)

Costco Wholesale Corp., headquartered in Issaquah, Wash., operates member warehouses and sells food and sundries, fresh foods and more through its state operations. United States, Canada and other segments of international operations.

Recent results reflect the following: For the second quarter and first 24 weeks of fiscal 2022, net sales for the quarter increased 16.1% to $50.94 billion from $43.89 billion dollars last year. Net sales for the first 24 weeks rose 16.4% to $100.35 billion from $86.23 billion last year.

Net income for the quarter was $1,299 million, down from $951 million. This was $246 million before tax and $0.41 per diluted share in costs incurred primarily from COVID-19 bonus salaries.

In February, Costco reported net sales of $16.29 billion, up 15.9% from $14.05 billion last year. For the 26-week period ended February 27, 2022, net sales were $108.39 billion, an increase of 16.3% from $93.16 billion last year.

DoorDash (NYSE:DASH)

Although it’s not technically a grocery store, we throw in DoorDash Inc. for good measure.

DoorDash Inc., headquartered in San Francisco, is a platform that connects merchants, consumers, and dashers. It offers customer acquisition, delivery, insights and analytics, merchandising, payment processing, and customer support. The company ultimately provides consumers with on-demand access to e-commerce.

DoorDash showed key financial metrics of fourth-quarter revenue that grew 34% year-over-year to $1.3 billion. Total orders increased 35% year over year to $369 million and market GOV increased 36% to $11.2 billion.

GAAP gross net income of $637 million obscured last year’s reports by $477 million. However, there was a GAAP net loss of $155 million, compared to a net loss of $312 million in the fourth quarter of 2020. Adjusted EBITDA was $47, down from $94 million in the fourth quarter 2020.

Put the stocks from the grocery store in your wallet

When combing through staple items to add to your wallet, don’t overlook stores that to bring basic consumer products.

Expect to see continued technological changes in grocery stores, such as cashierless stores and advanced AI technology. Also, don’t forget to look for strong dividend growth and competitive advantages among the grocery stores you think you want to add to your list. Recognizing the potential benefits will only increase your long-term benefits.

Costco Wholesale is part of the Entrepreneur Index, which tracks some of the largest publicly traded companies founded and led by entrepreneurs.