In late March. Peter Ashton of Recognia examined consumer stocks or the companies who products people use everyday. Ideally, the consumer stocks are defensive if the market declines because people still use their products.

The criteria he used was:

market capitalization of $ 10 billion or more

forward price earnings ratio of 27 or less

dividend at 2% and a dividend growth rate of 4% or more

beta of 0.75 or less which means the stock has 75% or less of the volatility of the overall market

Company                               Mkt Cap      BETA      P/E             Div Growth             Dividend

($ US Bil)                                         Rate (%)                  Yield (%)

Coca-Cola                             181.6             0.59         22.2                6.1                        3.4

Altria Group                        142.0             0.19         24.2                8.3                        3.3

Dr Pepper Snapple                17.8            0.46          22.0             10.4                        2.2

JM Smucker                            15.5            0.30           17.3               4.7                        2.2

PepsiCo                                 159.7             0.42          23.4                 7.1                       2.7

Kimberly Clark                      47.1             0.67          22.1                4.5                        2.8

The Hershey                            22.4           0.65            25.3                7.4                      2.2

Clorox                                        17.6           0.49            25.7               4.0                      2.3

Linking to dividend paying stocks, the above companies with products ranging from cola to cigarettes to chocolate are going to be bought and sold on a regular basis. For the most part whatever the economy, people will tend to buy the products. If you are doing the analysis you can change the variables and come up with even safer companies. Every year it is easier to do your homework and pick companies that will lose less money and more important will make money for you.

There are more questions than answers, till the next time – to raising questions.