By Ian Salisbury

Consumer staples stocks have rallied sharply in 2026. That's made it harder to find values -- but they still exist for investors willing to look.

With the market suddenly getting cold feet over artificial intelligence, investors have been snapping up shares of long-neglected staples stocks. After lagging the S&P 500 for three straight years, the State Street Consumer Staples Select Sector SPDR ETF has returned more than 15% year to date, while the broad market is essentially flat.

Unfortunately, for many investors it's been a blink-and-you-missed-it rally. Price-to-earnings ratios have ratcheted sharply higher in recent weeks, suggesting much of the rally's easy money has already been made.

"The Consumer staples sector's forward 12m P/E has soared to its highest since 1998," noted Kevin Gordon, a strategist at the Schwab Center for Financial Research, in a post on X Tuesday morning.

Staples stocks recently changed hands at 23.8 times forward earnings, up from less than 21 times last year, according to Gordon's post. Indeed, some staples are now trading at multiples that would make tech stocks blush.

Costco Wholesale trades at 48 times forward earnings; Walmart at 45 times; even candy bar maker Hershey trades at 27 times. By contrast, the State Street Technology Select Sectors SPDR trades at just 23 times estimated 2026 profits.

Fortunately, there are still some bargains to be found -- stocks that have posted solid price gains in 2026, are expected to deliver at least 5% earnings growth this year, and still trade below the broader market's average multiple of roughly 21 times forward earnings.

Agribusiness giant Bunge has seen shares jump 38% in this year, while competitor Archer Daniels Midland is up more than 20%. Earlier this month Bunge reported fourth-quarter earnings that beat Wall Street forecasts by nearly 10%. Analysts expect earnings to grow 7% in 2026 and 25% in 2027.

Bunge shares, which began the year priced at about 10 times forward earnings, still change hands at just 14 times.

Several brand-name consumer staples stocks also trade at relatively modest multiples despite the rally. PepsiCo, which has seen shares climb about 16% in 2026, trades at 19 times forward earnings. Analysts expect steady, if unspectacular, profit growth of 6% in 2026 and 7% in 2027. Keurig Dr Pepper is even cheaper, trading at just 14 times forward earnings.

Retail chains Kroger and Dollar Tree are also expected to post solid earnings growth in 2026. Kroger trades at about 14 times forward earnings, while Dollar Tree trades at roughly 19 times.

Write to Ian Salisbury at ian.salisbury@barrons.com

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February 17, 2026 17:05 ET (22:05 GMT)

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