Table of Contents
Foreword ix
Preface xi
Acknowledgments xv
Part I Getting Started in Consumer Staples 1
Chapter 1 Consumer Staples Basics 3
Overview 4
Staples’ Distant Cousin—Consumer Discretionary 7
The Business Cycle’s Winds of Change 10
Boring Can Be Beautiful 15
Chapter 2 History of Consumerism in America 21
Colonial America and Consumerism 22
Mass Production in the Late Nineteenth Century 26
The Roaring Twenties and the Consumer Economy (1921–1929) 28
Mass Marketing and Modern Consumer Products 35
The Modern Landscape 37
Chapter 3 Consumer Staples Sector Drivers 39
Economic Drivers 39
Political Drivers 52
Sentiment Drivers 55
Part II Next Steps: Consumer Staples Details 59
Chapter 4 Consumer Staples Sector Breakdown 61
Global Industry Classification Standard (GICS) 62
Global Consumer Staples Benchmarks 63
Food, Beverage & Tobacco 65
Household & Personal Products 86
Food & Staples Retailers 90
Chapter 5 Challenges in the Consumer Staples Sector 101
Challenge 1: Growing in Mature Industries 101
Challenge 2: Dealing With Volatile Input Costs 113
Chapter 6 Consumer Staples in Emerging Markets 123
Opportunity Knocks 123
Emerging Markets and Consumer Products 125
Investment Idiosyncrasies 135
Part III Thinking Like a Portfolio Manager 139
Chapter 7 The Top-Down Method 141
Investing Is a Science 141
The Top-Down Method 145
Top-Down Deconstructed 150
Managing Against a Consumer Staples Benchmark 158
Chapter 8 Security Analysis 163
Make Your Selection 164
A Five-Step Process 165
Important Questions to Ask 173
Chapter 9 Consumerize Your Portfolio—Investing Strategies 181
Strategy 1: Playing the Market Cycle 182
Strategy 2: Playing Style Shifts 186
Strategy 3: Develop New Categorizations 189
Implementing Your Strategy 191
Appendix: Consumer Staples Sector Resources 195
Notes 199
About the Authors 209
Index 211
