Citi names Pepsi and 3 other defensive stocks to help weather volatility

Amid rising volatility in the stock market and cooling interest in technology stocks, investment bank analysts looked to companies with strong reporting and stable outlooks

Citi Research analysts believe that amid stock market volatility, investors should take a closer look at defensive securities like PepsiCo, Estée Lauder, Atmos Energy and Regency Centers. These companies reported solid results in the third quarter and improved expectations for 2026, remaining independent of cyclical fluctuations and the trend toward artificial intelligence.

With the corporate reporting season coming to an end, Citi Research analysts have identified four companies that showed strong results for the third quarter and improved their forecasts amid a volatile stock market. Experts' favorites were beverage producer PepsiCo, cosmetics giant Estée Lauder, gas distribution company Atmos Energy and real estate organization Regency Centers, Barron's writes .

According to Citi, of the 418 companies that had reported by the time of the analysis, 128 had beaten analysts' expectations while raising their forecasts. The problem is that most of them are from companies related to artificial intelligence or cyclical industries, so they are not suitable for a solid defense against market declines, Barron's explains. Many other players represent the healthcare sector, which is now under pressure due to political instability in Washington.

Although the S&P 500 is up 14% this year, investors are increasingly questioning the strength of the bull market, Barron's adds. The market broke off a three-week run of gains last week and now sits about 2.3% below its Oct. 28 record high. Technology stocks look particularly vulnerable, with the Nasdaq Composite down about 4% from its October peak.

The company's shares have fallen by about 5% since the beginning of the year. At the opening of trading on November 11, the securities appreciated by 0.5%.

Overall, it's been a challenging year for PepsiCo, with the brand losing market share to competitors like Dr Pepper and Sprite, and Doritos and Lays products facing inflationary pressures and growing consumer interest in healthy eating, Barron's notes.

However, in October, the company reported third-quarter earnings that exceeded expectations by about 1%, prompting analysts to raise their target share prices. On average, the market expects sales growth of 3.4% and earnings growth of 5.6% next year, the publication said.

Most experts in the market do not expect strong growth, but also do not predict a serious fall in quotations. According to MarketWatch, only eight analysts advise buying the company's shares, 16 suggest holding and one suggests selling.

Estée Lauder shares are up about 22% in 2025. In October, the company reported that third-quarter profit exceeded forecasts by more than 80% thanks to strong sales in its skincare and perfume segments. The stock was up 1.4% at the open of trading on Nov. 11.

The analytical community is reserved with regard to the company's securities. Only nine experts advise to buy them, the majority - 19 - recommend to hold them.

The company showed profit for the third quarter by 8% above analysts' expectations. At the opening of trading on November 11, the securities were growing by 0.5%.

The market's assessment of the organization's shares is moderately positive, but restrained.Three analysts advise to buy the securities, 11 - to hold and one believes that the quotes are trading below the market.

The company reported quarterly results that matched Wall Street's average forecasts but slightly beat Citi's estimate. This allowed it to get into the list of leading defensive companies. At the opening of trading on November 11, quotations rose in price by 0.6%.

Analysts mostly believe in the potential of Regency Centers shares and positive business prospects. 14 experts advise to buy them, eight - to hold.

This article was AI-translated and verified by a human editor