Low-Beta Titans: How PM, SFM, and NEM Offer Safety and Growth in a Volatile Trade Landscape

As global trade tensions escalate and U.S. tariff policies roil markets, investors are scrambling to balance risk and return. In this environment, low-beta stocks—those less volatile than the broader market—present a compelling opportunity to mitigate downside while capitalizing on sector-specific tailwinds. Three equities, Philip Morris International (PM), Sprouts Farmers Market (SFM), and Newmont Corp. (NEM), stand out as defensive yet high-growth picks, all rated Zacks Rank #1 (Strong Buy) and trading at betas below 0.87. Their combination of stability, resilience, and sector leadership makes them must-hold positions for 2025.

The Case for Low-Beta Stocks in a High-Volatility World

Beta measures a stock’s sensitivity to market swings. A beta below 1 means the stock is less volatile than the S&P 500, offering insulation during downturns. With the U.S. imposing tariffs on everything from consumer goods to industrial materials, investors need portfolios that can weather uncertainty. Low-beta stocks like PM, SFM, and NEM excel here, but they’re also delivering outsized gains: collectively, their year-to-date returns exceed 30%, outperforming the market’s flat trajectory.

Philip Morris International (PM): The Tobacco Innovator with a 0.50 Beta

Philip Morris isn’t just a cigarette company—it’s a leader in smoke-free products, a strategic shift driving its 44.7% YTD surge. With a beta of 0.50, PM’s stock has been a ballast in portfolios rattled by trade wars. The firm’s IQOS heated tobacco devices now account for 42% of revenue, up from 34% in 2024, signaling secular growth.

Why buy now?
- Zacks #1 ranking reflects upgraded earnings estimates, with 2025 EPS forecasts rising 8% in the past 60 days.
- Valuation remains attractive: a 15.2x forward P/E versus 18.5x for the S&P 500.
- Trade tensions have little direct impact on its smoke-free growth, as most sales are in Asia and Europe.

Sprouts Farmers Market (SFM): Grocery Resilience at a 0.87 Beta

Sprouts is proving that health-focused grocery stores can thrive even as inflation and trade disputes pressure consumer spending. Its beta of 0.87 edges just below the 0.87 threshold, but its 32.2% YTD gain and Zacks #1 rating make it a standout. The company’s focus on private-label products (now 23% of sales) and e-commerce expansion (up 50% in 2024) are key growth levers.

Why buy now?
- Same-store sales growth of 4.7% in Q1 2025, outpacing peers.
- Valuation at 22.4x forward P/E is justified by its 18% EPS growth estimate for 2025.
- Trade tariffs on imported goods? SFM’s reliance on local, organic suppliers insulates it from supply chain shocks.

Newmont Corp. (NEM): Gold’s Steady Hand with a 0.31 Beta

Newmont’s beta of 0.31 makes it the least volatile of the trio, yet its stock has still risen 40.5% YTD—proof that low beta doesn’t mean low reward. As a gold miner, NEM benefits from the metal’s inverse correlation to equities, a critical hedge against trade-driven market instability.

Why buy now?
- Zacks #1 rank is backed by a 37% EPS upgrade since January 2025, driven by higher gold prices ($2,000/oz+) and cost controls.
- Valuation at 18.9x forward P/E is a bargain versus peers.
- Expansion projects like Ghana’s Ahafo North mine (expected to boost production by 15% by 2026) provide long-term growth.

A Portfolio Play for 2025: Buy Low Beta, Own the Future

These stocks aren’t just defensive plays—they’re growth engines in their own right. PM’s smoke-free revolution, SFM’s grocery dominance, and NEM’s gold expansion all align with secular trends insulated from trade squabbles. Their low betas and Zacks #1 rankings signal that now is the time to act.

The Bottom Line:
In a world where volatility is the norm, PM, SFM, and NEM offer rare clarity. Their combination of stability, valuation upside, and sector-specific moats makes them essential buys for portfolios. Don’t let another day of market swings pass without securing these three low-beta titans.