Stagflation is a scenario where the economy is riddled with three major problems, namely, high inflation, slow growth, and rising unemployment. Sounds familiar? That is because it is the reality now, and this situation can continue as the war in the Middle East rages on. While gas prices are hovering near their highest levels since 2022 at about $3.50 per gallon, non-farm payrolls declined by 92,000 compared to estimates of a growth of 50,000 in February, dealing another major blow to the economy.
The Federal Reserve is also caught between a rock and a hard place, as cutting rates would add fuel to the inflation, while raising rates is also not a good proposition for corporate America.
So, as investors, how should our portfolios be navigated? Is there no silver lining? There certainly is, and here are three top names from our list of stagflation stocks that can act as a bulwark against the vagaries of the uncertain economic times we are living in right now.
Stagflation Stock #1 Coca-Cola (KO)
Nothing is better than to heed the sage Warren Buffett's advice in times of turmoil and load up on his favorite stock, Coca-Cola (KO). Founded in 1892 and having operations in more than 200 countries, Coca-Cola is the largest beverage company in the world and is the owner of seminal brands such as the eponymous Coca-Cola, Sprite, and Fanta, among many others.
Valued at a market cap of $334.6 billion, KO stock is up 10% on a year-to-date (YTD) basis while offering a dividend yield of 2.65%, which is higher than the sector median. Notably, the company is a “Dividend King,” having raised dividends consecutively over the past six decades.
Meanwhile, the company's latest results for Q4 2025 were mixed, with revenues missing but earnings beating estimates. Net operating revenues increased by 2% from the previous year to $11.8 billion, while earnings went up by 5.5% in the same period to $0.58 per share. Not only was this higher than the consensus estimate of $0.56 per share, but it was also the ninth consecutive quarter of earnings beat from the company.
2025 saw the company reporting net cash from operating activities of $7.4 billion, up from $6.8 billion in 2024, as the company closed the quarter with a cash balance of $10.3 billion. This was much above its short-term debt levels of $1.8 billion.
Thus, analysts have attributed a consensus rating of “Strong Buy” for the stock, with a mean target price of $84.17, which denotes an upside potential of about 8% from current levels. Out of 24 analysts covering the stock, 19 have a “Strong Buy” rating, two have a “Moderate Buy” rating, and three have a “Hold” rating.
Stagflation Stock #2: Energy Transfer (ET)
We next shift our focus towards Energy Transfer (ET), an energy infrastructure company that can benefit from the possible increase in demand for U.S. energy exports. Founded in 1996, it is a midstream energy infrastructure company. It does not produce oil or gas. Instead, it provides the infrastructure needed to move and process energy products.
Valued at a market cap of about $64 billion, the ET stock is up 12% on a YTD basis. The stock also offers a dividend yield of 7.15%, which is higher than the sector median.
And just like Coca-Cola above, ET's results for Q4 2025 were also mixed. However, ET reported a beat on revenues, not earnings. In fact, ET has not been reporting a beat on earnings for three quarters straight now.
Revenues for the quarter came in at $25.3 billion, an increase of 29.5% from the previous year. Moreover, while natural gas liquid transportation volumes were up 5% from the prior year, crude oil transportation volumes were up 6% in the same period.
While earnings of $0.25 per share were down from $0.29 per share in the year-ago period, they came in much lower than the consensus estimate of $0.37 per share.
Net cash from operations for the year also declined to $10.1 billion in 2025 from $11.5 billion in the year-ago period. Overall, Energy Transfer closed the quarter with a cash balance of $1.3 billion, much higher than its short-term debt levels of $270 million.
Overall, analysts have deemed the stock to be a consensus “Strong Buy.” The mean target price of $21.68 indicates an upside potential of about 18% from the current levels. Out of 17 analysts covering the stock, 12 have a “Strong Buy” rating, one has a “Moderate Buy” rating, and four have a “Hold” rating.
Stagflation Stock #3: Gilead Sciences (GILD)
We conclude our list with a leading name from the biotechnology sector. Founded in 1987, Gilead Sciences (GILD) is one of the most important biotechnology companies in the world, particularly known for HIV and antiviral therapies. Its core therapeutic areas include HIV/AIDS, liver diseases, oncology, inflammatory diseases, and antivirals.
Its market cap currently stands at about $182 billion, while GILD stock is up 20% on a YTD basis. Furthermore, the stock also offers a dividend yield of 2.20%.
Notably, Gilead's results for the most recent quarter were marked by a beat on both revenue and earnings. While revenues went up by 5% yearly to $7.9 billion on the back of strong sales from HIV and liver disease products, earnings were actually down by 2.1% in the same period to $1.86 per share. However, not only was it above the consensus estimate of $1.81 per share, but this was also the eighth consecutive quarter of earnings beat from the company.
Meanwhile, net cash from operations for the year was at about $10 billion, a tad lower than 2024's $10.8 billion, as Gilead closed the year with a cash balance of $7.6 billion. This was lower than its current liabilities of $11.8 billion.
Considering this, analysts have deemed the GILD stock to be a consensus “Strong Buy” with a mean target price of $158.11, which denotes an upside potential of about 6.4% from current levels. Out of 32 analysts covering the stock, 22 have a “Strong Buy” rating, two have a “Moderate Buy” rating, and eight have a “Hold” rating.
On the date of publication, Pathikrit Bose did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
More news from Barchart
- Wall Street Loves Palantir Stock as the Iran War Rages On
- Applied Materials and Micron Are Partnering on Memory. Is AMAT or MU Stock a Better Buy Here?
- Should You Buy Vertiv Stock Before March 23?
- Former Starbucks CEO Howard Schultz Announces Move to Miami Same Day as Washington Passes New Millionaires Tax
