For this article, the "food sector" refers to businesses whose principal function is the distribution of consumables other than alcoholic beverages. Markets, wholesalers, and shops selling food and drink are all considered part of the retail food industry.

Excluding the restaurant business is necessary because it is a cyclical industry (consumers cut back on eating out when times are tough). Companies such as The Kroger Co., Darling Ingredients Inc., and B&G Foods Inc. are just a few examples operating in the food sector.

One year before June 2, 2022, the S&P 1500 Food Products Industry Index had a total return of 4.1%, while the Russell 1000 Index had a total return of -1.6%. That the food industry has done better than the overall market is a positive sign.

We've compiled a list of the top three food stocks that satisfy these criteria and explain why we picked them. Next are some tables with data from June 2, 2022.

Leading Food Industry Stocks

The following are the food stocks with the cheapest price-to-earnings ratios for the past year. Because profits can be redistributed to shareholders in the form of dividends and stock buybacks, a low P/E ratio is desirable.

Food and agriculture stocks are ranked by price ($) and market capitalization ($B).

The JBS S.A. firm processes meat in Brazil. Meats like cattle, pigs, lamb, and poultry are processed and prepared there. This company provides metal packaging, leather items, and cleaning materials.

Sanderson Farms, Inc. opened its doors in 1976, and the company has become widely recognized for its chicken products. Both fresh and frozen chicken is available at the market. On May 27, the firm turned in its 10-Q for the quarter that ended on April 30, 2022. The pace of growth in annual net income was more than three times that of annual net sales. Most of the growth was attributable to demand for its vacuum-sealed, chill-packed, and ice-packed chicken products.

Herbalife Nutrition is a worldwide nutrition company that operates as a division of Herbalife Ltd. Nutritional supplements for athletic performance, physical fitness, sustained energy, and healthy weight management are all on hand. The shop also sells products related to personal cleanliness and grooming. On May 3, Herbalife announced the financial results for the first three months of the fiscal year 2022. Annual net income was down significantly as revenues dropped. Worldwide, the company's sales fell. That includes the Americas, China, Europe, the Middle East, and Central and South America.

Rapidly Expanding Marketable Food Supply

According to a growth model that emphasizes a company's revenue growth and earnings per share growth from the most recent quarter year over year, these are the best food stocks. The success of a business depends on both sales and profitability. Using a single metric as the only basis for a company's growth ranking is problematic because accounting irregularities in a given quarter (such as changes in tax law or restructuring charges) may affect the results of one statistic but not the other. Companies with quarterly EPS or revenue increases of greater than 2,500% were deemed outliers and eliminated from the study. Stocks in rapidly expanding food companies that are selling at the lowest prices

Earnings per share growth rate in percentage terms

Celsius, short for Celsius Holdings, Inc., develops and distributes fat-burning beverages. Many retail establishments stock it, including supermarkets, drugstores, convenience stores, supermarkets, and gas stations. For the first three months of 2022, Celsius shared their financial results on May 10. As revenues increased by almost 100% yearly, so did net income. Club sales, automated vending machine sales, direct store delivery, and other domestic channels grew rapidly, more than offsetting a decline in exports.

The Sysco Company: Sysco is a wholesale food distributor that serves numerous industries, including the hospitality industry, institutional kitchens, and institutional dining halls. It also is a reliable source for the hospitality and food service industries. Read the preceding section for more details on Sanderson Farms, Inc.

Food Items to a Vast Network

Corporate Name: SpartanNash In addition to its retail stores and U.S. military commissaries and exchanges, SpartanNash supplies food items to a vast network of small businesses and national chains across the country. The company also operates a grocery chain and a distribution center for locally grown produce. SpartanNash announced on May 31 a quarterly dividend of $0.21 per share. The dividend will be paid on June 30, 2022, to stockholders of record on June 15.

Supermarket and drugstore chain The Albertsons Companies, Inc. It operates a retail food chain selling various grocery items, including fresh produce, prepared foods, bakery items, and canned goods. It also oversees convenience stores, gas stations, storage facilities, and manufacturing facilities.