The swing is coming in this next market cycle. While markets may have priced in potential interest rate cuts from the Federal Reserve (the Fed), some stocks have yet to reach their full potential.

Technology stocks took the lion’s share of bullish momentum, with names like Nvidia Co. (NASDAQ: NVDA) making all-time highs. Still, some in the consumer staples sector offer a much better risk-to-reward proposition.

Businesses in the consumer discretionary sector would be the first to make a move on new interest rate pivots. However, traders keep pushing their expectations for these cuts further.

Once expecting cuts in March 2024, projections in the FedWatch tool offered by the CME Group Inc. (NASDAQ: CME) show these tendencies going as far as September 2024.

As long as the timing – and magnitude – of these cuts remain speculative, stocks like Freshpet Inc. (NASDAQ: FRPT), Celsius Holdings Inc. (NASDAQ: CELH), and even Tyson Foods Inc. (NYSE: TSN) could be the ones to offer investors some stability.

As their products often stay in demand through the business cycle, Wall Street analysts spotted an opportunity to cushion any market uncertainty.

Freshpet’s Hidden Moat

Like its competitor, Chewy Inc. (NYSE: CHWY), Freshpet is backed by the naturally non-cyclical nature of pet needs. Whether the U.S. economy is booming or busting, pet owners will likely still find ways to budget for their pets' needs monthly.

Combining technology on top of a wholesale/retail model, Freshpet is giving investors an opening to squeeze potential returns in the coming months.

This is one reason analysts at Truist Financial Co. (NYSE: TFC) boosted their price targets to $135 a share. Freshpet stock would have to rally by 18% to prove these projections right.

More than that, overall earnings per share (EPS) expectations are set to a 560% growth rate in the next 12 months. Willing to pay for a good stock, markets value Freshpet at a forward price-to-earnings (forward P/E) ratio of 176.8x.

This valuation places Freshpet at a 689% premium to the staples sector, as its average valuation is 22.4x forward P/E today.

The saying “It must be expensive for a reason” applies here, as the Vanguard Group was also willing to buy up to 0.7% more stock in its position, an approximate $2.8 million addition.

Wall Street’s Fashion For Celsius Drinks

Speaking of institutional buying, how is a $19.2 million investment by The Goldman Sachs Group Inc. (NYSE: GS) as it boosted exposure by 80.8% in the past quarter? Vanguard also saw fit to increase its own investment by 183%, an aggressive fashion by Wall Street.

However, The PNC Financial Services Group Inc. (NYSE: PNC) took the podium by boosting its position in the stock by 202% in the past quarter. In percentage terms, these allocation moves signify a newfound confidence in these institutions in the stock's future.

Not known for its growth, the staples industry is projected to see an 8% EPS increase for the year. In comparison, Celsius analysts project up to 40%. No wonder those at the Maxim Group felt bold enough to boost price targets to $110 a share, calling for a 29% upside from today.

Celsius’ 55x forward P/E still gives it a 145% premium to the staples sector. This is a sign that markets are accepting analyst projections and willing to pay for this potential growth.

Tyson’s Dip Opportunity

Chicken costs surged throughout 2023 as feed and other factors soared, and companies like Tyson saw no other path but to report tighter gross margins in their financial statements. However, easing inflation pressures has helped margins and outlooks for the chicken business.

With soybean feed and other components declining in cost, margins and outlooks are now improving, according to Tyson’s management. The stock trades at 93% of its 52-week high, a sign of bullish momentum; however, it is nothing close to its 2022 high price of $100.7 a share.

Knowing that Tyson could have some value to be squeezed, Fisher Asset Management bought up to $682,000 worth of Tyson stock. Likewise, analysts at Citigroup Inc. (NYSE: C) boosted their price targets on Tyson to $62 a share, a valuation 5% higher for this $21 billion giant.

Analysts think Tyson’s EPS could grow by 57% this year, pushing much higher than its historical expectations. Another non-cyclical stock in this list going for above-average growth for the coming Fed pivot.