The Best Canadian Food Stocks in March 2023
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Loading... - Sabrina Jabal
- 20 Mar 2023
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Canadian food prices are increasing at faster rates than the overall consumer inflation rate. Food inflation at 10.4% for January 2023 printed a new 40-year record, even as the Consumer Price Index (CPI) slowed to an inflation rate of 5.9%. The food market remains heated, and food stocks could outperform the broader TSX in 2023. Loblaw Companies (TSX:L) and Maple Leaf Foods (TSX:MFI) are two interesting Canadian food stocks to buy in March.
Food inflation has remained above the 10% per annum mark since September 2022. Consumers feel the pinch. However, some food producers and distributors might be having their best days. Investors looking for the hottest sectors to add to their “shopping” baskets for 2023 should check out Canadian food producers and marketers. This staple sector has been able to pass rising costs to consumers and maintain (or grow) margins. Investment and retirement portfolios could enjoy a piece of the outperforming food stocks’ pie this month.
Let’s take a closer look.
Loblaw Companies
Loblaw Companies, as Canada’s largest grocery store operator, has become the face of food inflation. The company’s recession-resilient value brands, especially the No Name family of cheaply priced foods, are among the go-to household products as inflation bites consumers’ pockets. Management lifted a three-month compassionate price freeze on about 1,500 No Name products last month to protect its margins. More revenue growth could be on the way as the company maintains healthy margins during the food market turbulence.
The $38-billion food market giant boasts 2,400 store outlets accessible to over 90% of Canadians who live within a 10-kilometer radius of a Loblaw store. It’s most likely that Loblaw will report another good quarter as it charges more for its products and passes down rising costs to loyal, increasingly value-conscious consumers. Read More…
