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Written by Micah Zimmerman for The Motley Fool->
Consumer staples with pricing power are outperforming amid volatility, tariffs, and cautious spending.
Strategic mergers and spinoffs for McCormick and Keurig Dr Pepper are creating hidden value and long-term earnings catalysts.
Temporary market dislocations are offering attractive entry points into durable, global brands.
There's a reshuffling happening in the consumer sector. Market volatility, tariff pressure, and a cash-strapped consumer that's becoming more deliberate about spending have created a unique window. Companies with durable brands and pricing power are trading at levels that may not last.
Here are four stocks worth a serious look right now, this month, in May.
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When a company operating in nearly every country on earth beats revenue and earnings per share (EPS) estimates and raises its full-year guidance, that's worth noting and potentially buying. Coca-Cola (NYSE: KO) reported first-quarter 2026 results on April 28. It posted revenue of $12.47 billion, up 11.2% year over year, and comparable EPS of $0.86, beating consensus by 5.9%.The company then raised its full-year comparable EPS growth guidance to 8% to 9%, up from a prior range of 7% to 8%.
What's driving it isn't just price hikes. Unit case volume grew 3% globally -- meaning actual demand, not just dollar math, is expanding. For newer investors, unit case volume is the metric that proves pricing hasn't chased away customers. Coca-Cola also gained value share across sparkling beverages, water, sports drinks, coffee, and tea -- a rare broad sweep. Coca-Cola is a solid, slow buy that will only go higher over time.
Walmart (NASDAQ: WMT) is somewhat of a tariff paradox to me. The company reports its fiscal Q1 2027 results on May 21, and the setup is unusually compelling. Here's the counterintuitive thesis: Tariff anxiety, which has spooked markets broadly, may actually be Walmart's ally. When people feel economic pressure, they trade down -- and they trade down to Walmart. High-income households (those earning over $100,000 annually) have been contributing meaningfully to Walmart's comparable sales gains, shifting from specialty grocers to its private-label brands. That trend is likely to continue as tariff costs seep into everyday prices across retail categories.
Over the last year or so, Walmart has also committed to keeping grocery prices "as low as [it] can," explicitly refusing to let tariff pressure on general merchandise flow through to food. This positioning directly targets the most frequency-driven category in retail.
McCormick (NYSE: MKC) announced in late March that it will merge with Unilever's (NYSE: UL) foods business -- the division that owns Hellmann's, Knorr, and related brands -- creating a combined company with approximately $20 billion in annual revenue. The deal is expected to be accretive to McCormick's EPS in the first full year, with $600 million in expected annual run rate cost synergies. It significantly expands McCormick's footprint in emerging markets, including Brazil, China, and Europe. McCormick will retain its name, Maryland headquarters, and NYSE listing post-merger.
For a retail investor like me, this sounds kind of boring, but it is a sign that this stock was already inexpensive before the announcement and has now taken on a transformational catalyst that won't close until mid-2027. That timing creates a window. If you look at the stock's one-year price chart, it's not pretty right now, which is why I think now is a good time to start accumulating the stock.
There is a risk here of deal execution. Integrating a food division of this scale is complicated, and leverage will rise temporarily. But the long-term strategic logic -- dominant global spice and condiment brands under one roof -- is hard to argue with.
Keurig Dr Pepper (NASDAQ: KDP) closed its acquisition of JDE Peet's on April 1, creating a global coffee powerhouse spanning brands like Peet's, Jacobs, L'Oréal, and Keurig across more than 100 markets. More importantly for investors, the company has announced plans to separate into two independent, U.S.-listed businesses: A North American refreshment beverages company and a pure-play global coffee company, with the coffee spinoff planned for operational readiness by year-end 2026.
The Q1 2026 earnings report, released April 23, beat on both EPS and revenue, and the company reaffirmed full-year guidance for low-double-digit adjusted EPS growth in constant currency. The JDE Peet's deal is expected to be approximately 10% EPS accretive in its first full year. The separation is where the real value unlock lives: Two focused businesses, each with a distinct capital allocation story, attracting different investor bases.
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Micah Zimmerman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Walmart. The Motley Fool recommends McCormick and Unilever. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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