Reckitt Benckiser Group PLC (LSE:RKT, ETR:3RB), owner of brands such as Cillit Bang, Dettol and Durex, is a 'buy' with household essentials likely to perform well in a recession, according to Deutsche Bank.
The bank is also excited about Enfamil, Reckitt's baby formula product in the US, which “holds onto significant gains in the share of consumer interest as we move into what we expect to be a period of rising US births”.
“Specifically, we look at search data by state in the US, which still shows share of search gains for Reckitt over Abbott, even in states where Abbott is the WIC contract provider”, WIC being Women, Infants, and Children, it said.
Deutsche Bank added that, while it has said in the past European staple products are stretched compared to European cyclical products, that is not the case in a global context.
However, it still expects a slowdown in the US in 2023, with consumer sentiment in line with new ISM orders and US unemployment closer to 10%.