The price of everything has gone up. Despite this, there a certain sectors that can withstand the effects of inflation. The "consumer staples" sector is one of them, with the primary staple being food. Everyone has to eat, and people find ways to do it cheaper, but they still continue to eat.
(Created with Bing)
Food Is A Necessity
It's no surprise that grocery stores tend to be more resilient in down markets, as people will continue to buy food. They may opt for cheaper brands or smaller quantities, but people are still spending a significant portion of their budget at grocery stores.
A Requirement to Stay in Business
Aside from cash and product, what does a grocery store need in order to operate? A building. Most grocery stores lease their building, especially if they're located in a shopping center. When they're located in a strip mall or shopping center, they're considered an "anchor tenant," which means their presence drives business and foot traffic to that location, which encourages other business to lease adjacent suites.
Resilient Real Estate
Real estate can do well even during economic downturns, recessions, etc. I'm no financial advisor, but my bet is that Slate Grocery REIT is a real estate investment trust that can withstand uncertain times because they primarily lease to grocery stores in strip malls and shopping centers. The foot traffic to the grocery stores also results in foot traffic to adjacent businesses, which ultimately means a number of low-risk investment properties with minimal turnover.
Why Slate Grocery REIT?
I'm looking at SGR.UN because their stock price is slightly undervalued compared to their 52-week high and all-time high. They're currently trading at $15.89/share before market open, which is slightly down from their all-time high of $17.22/share. They also pay a dividend of about 7.4%, which they've slowly increased over the last 12 years, and they've never missed a payment. (Source)
While I don't expect significant share price growth yet, I think they have the ability to weather a continued recession as inflation really hasn't been reduced. Time will tell since I'm no financial expert, but I think they're in a good position to be conservative now, grow slowly, and come out even stronger in time.
Buy DUO and stake to receive Hive dividends, tip others, have your posts curated, and grow Hive!
https://tribaldex.com/trade/DUO
https://hive-engine.com/trade/DUO
Do you like stacking gold and silver?
Are you new to Hive, or know someone new to Hive, and want help and support?
Have you been on Hive for a while and want to help new Hive members? Join HOC and help us grow Hive and encourage new members!
Posted Using INLEO