With tech stocks under pressure, AI expectations in question, and volatility spilling across global markets, many investors are looking more closely at defensive sectors such as consumer staples, utilities, and healthcare. These areas are often used as potential anchors when high growth stories like Nvidia, Meta Platforms, or Microsoft face sharp pullbacks or when concerns rise around interest rates and inflation. This article looks at 3 stocks from a Defensive Sectors screener that are directly exposed to the current news backdrop, helping you assess which opportunities may still fit a cautious, income-focused watchlist.

A.G. BARR (LSE:BAG)

Overview: A.G. BARR is a UK based soft drinks group behind brands such as IRN BRU, Rubicon and MOMA, manufacturing and distributing a wide range of non alcoholic beverages and cocktail solutions across the UK and selected international markets.

Operations: A.G. BARR generates most of its £437.3 million revenue from Soft Drinks at £382 million, with Cocktail Solutions at £35.8 million and Other revenue at £19.5 million, primarily in the UK at £418.8 million.

Market Cap: £680.3 million

For investors rotating toward defensives as tech valuations are questioned, A.G. BARR offers exposure to everyday beverage spending that often proves more resilient when growth stocks are under pressure. The stock sits well below Simply Wall St’s estimated cash flow value, while P/E is lower than the wider European beverage peer group, which may interest value focused investors looking at cash generative staples. At the same time, margins sit at 10.8% and the dividend yield of 3.03% adds income appeal, even though free cash flow coverage is a concern. The key question is whether this mix of potential undervaluation, steady fundamentals and funding risk suits a defensive watchlist.

A.G. BARR’s mix of everyday brands, a P/E below European beverage peers and a 3.03% yield hints the market may be mispricing its resilience, but the real tension shows up in the 4 key rewards and 1 important warning sign

Finsbury Food Group (AIM:FIF)

Overview: Finsbury Food Group is a Cardiff based bakery company that produces cakes, bread, and snack products for supermarkets, coffee shops, foodservice operators, and high street chains, supported by a wide portfolio of licensed brands such as Disney, MARS, Thorntons, and Weight Watchers.

Operations: Finsbury Food Group generates most of its revenue from UK Bakery at £351.1 million, with Overseas contributing £62.7 million.

Market Cap: £136.5 million

For investors scanning defensive sectors while tech stocks sell off, Finsbury Food Group offers exposure to everyday bakery spending with a valuation that sits well below some estimates of fair value and a P/E that is lower than both peer and industry averages. Earnings have grown 14.4% per year over five years and are forecast to rise further. However, margins are thin at a 2.6% net profit margin and a return on equity of around 9% keeps quality questions in play. Adding in an unstable dividend history, funding that leans on external sources, and a board that has seen little recent refresh, results in a stock where the core bakery franchise and improving margins meet some governance and income risks that are easy to overlook at first glance.

Finsbury Food Group’s thin 2.6% margin and 9% return on equity sit beside a P/E that looks cheap, which raises a bigger question about what is already priced in. Get the fuller picture in the 4 key rewards and 1 important warning sign

Hershey (HSY)

Overview: The Hershey Company is a long established US food group that produces chocolate, sweets and salty snacks, as well as pantry items like baking ingredients and syrups, selling brands such as Hershey’s, Reese’s, Kisses, Kit Kat, SkinnyPop and Dot’s Homestyle Pretzels across supermarkets, convenience stores and other retailers in around 65 countries.

Operations: Hershey generates most of its US$11.99b revenue from North America Confectionery at US$9.67b, with North America Salty Snacks at about US$1.34b and International operations at roughly US$978m, and the bulk of sales coming from the United States at US$10.50b.

Market Cap: US$34.66b

Hershey stands out in a tech led selloff because it sits firmly in the consumer staples camp, with widely known brands, a 3.24% dividend yield and products that tend to feature in everyday baskets even when growth stocks are under pressure. Recent Q1 numbers showed revenue of US$3.10b and net income of US$435.11m. One estimate suggests the stock trades 40.1% below fair value, which may attract investors looking for defensive quality at a discount. However, margins have compressed, earnings declined 33.9% over the past year, cocoa costs and tariffs are a headwind and high debt is inflating a 23.11% ROE. A key issue for investors is whether Hershey’s push into salty snacks and higher protein products can offset those pressures enough to support its premium P/E and analyst optimism.

Hershey’s compressed margins and cocoa costs may be masking what its 3.24% yield and salty snacks push could mean for valuation and income. Get the context in the analysis report for Hershey

The three defensives in this article are only a starting point. The full Defensive Sectors screener surfaces 34 more companies that pair balance sheet strength, dividends, and sector resilience with equally compelling narratives. Use Simply Wall St to identify and analyze the specific catalysts, risk flags, and business stories that matter most so you can focus on the highest conviction ideas across defensive sectors.

Take Control of Your Investment Journey

If Finsbury Food Group or any of these companies sound like a great opportunity, register for FREE with Simply Wall St and add your companies to a Watchlist to monitor the share price against the fair value the ideal entry point. Once you've made your move, manage your holdings with our Portfolio Command Center that filters out the noise to deliver only the most critical, actionable updates. Throughout your journey, our Community allows you to filter the best ideas from thousands of investor perspectives. By uncovering hidden catalysts and risks early, you'll accelerate your decision-making and stay one step ahead of the market.

Seeking Fresh Alternatives Beyond Defensives?

Some of the most interesting breakouts start quietly, while attention stays glued to tech and defensives. Before momentum increases and ideal entries attract a broader crowd, consider exploring potential opportunities.

• Spot under the radar strength by scanning a curated pool of companies with resilient balance sheets using the list of solid balance sheet and fundamentals (18 results).
• Follow income trends by tracking curated companies in the 4 dividend fortresses while yields remain elevated and prices have not fully reflected the cash returns.
• Review curated opportunities across the 49 AI infrastructure stocks to analyze companies involved in AI-related infrastructure.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.