On June 25, the latest Consumer Price Index (CPI) hit the street. During May, consumer prices rose 4.1% compared to the prior-year’s month. This is the largest reported year-over-year increase in over 3 years, suggesting that solving the inflation problem remains a work in progress.
Yes, one key factor driving last month’s reading was rising gasoline prices. With recent geopolitical tensions easing, sending energy prices lower, the inflation rate could ease in the months ahead. Still, even if inflation eases, it’s likely to remain at elevated levels, which explains newly appointed Federal Reserve Chairman Kevin Warsh’s hawkish “higher for longer” stance on interest rates.
Nevertheless, even as high inflation persists and could lead to a new wave of stock market volatility, you need not head for the hills. While “inflation-proof investments” is a bit of a misnomer, here are three stocks that stand to thrive in the current environment: Costco Wholesale (COST 0.84%), Visa (V +1.72%), and WM (WM 1.23%).
Image source: Getty Images.
Costco could keep benefiting from the inflationary squeeze
After a strong start earlier in the year, Costco shares have pulled back in the past month. Chalk this up to valuation concerns. At its highs earlier this year, at nearly $1,100 per share, this consumer staples stock traded at nearly 50 times forward earnings.
Yet while valuation has only tempered somewhat, Costco can likely sustain its current forward multiple in the low 40s. Its current valuation not only lines up with what this consumer staples stock has traded for in the past; based on the company’s latest quarterly sales data, the discount retail club operator continues to “crush it,” with net and same-store sales rising 11.6% and 9.8% year over year, respectively.
Today’s Change
(-0.84%) $-8.04
Current Price
$944.50
Key Data Points
Market Cap
$422B
Day’s Range
$943.57 – $969.75
52wk Range
$844.06 – $1096.50
Volume
55.7K
Avg Vol
2.2M
Gross Margin
12.88%
Dividend Yield
0.56%
As buying in bulk is one of the most viable ways to adapt to rising prices, it’s no wonder Costco continues to thrive. Better yet, even as its underlying retail business operates on razor-thin margins, the company continues to collect tens of billions each year in membership fees. These fees serve as both an economic moat and a steady revenue stream. Among inflation-resistant stocks, Costco remains a top choice for long-term, buy-and-hold investors.
Visa has both near- and long-term trends on its side
Selling Visa may have been one of Greg Abel’s first moves as the new CEO of Berkshire Hathaway, but you may not want to follow his lead given this stock’s potential to benefit from further high inflation. As a payment processor, Visa benefits from higher prices, which drive higher transaction volumes, especially as households increasingly use payment cards for everyday transactions.
In turn, this translates into further growth for the company. This dynamic was on full display last quarter when Visa reported $11.2 billion in revenue, a 17% jump from a year ago and Visa’s highest quarterly revenue growth rate since 2022. Adjusted earnings also increased by 17%, while adjusted earnings per share (EPS) increased 20% from the prior-year’s quarter.
Today’s Change
(1.72%) $5.79
Current Price
$342.02
Key Data Points
Market Cap
$634B
Day’s Range
$338.01 – $345.81
52wk Range
$293.89 – $359.66
Volume
267.7K
Avg Vol
7.9M
Gross Margin
78.28%
Dividend Yield
0.77%
Over a longer time frame, Visa stands to benefit from another macrotrend: the move toward a “cashless society.” As a greater share of personal transactions worldwide shifts from cash to card or digital payments, Visa’s transaction volumes will likely continue to climb, resulting in further strong growth.
Trading for around 22 times forward earnings (a big drop in valuation compared to a year ago) and surging on earnings growth, shares may be in for a re-rating back to a higher forward multiple.
WM keeps turning trash into cash
Irrespective of the economic environment, someone has to take out the trash. For a plurality of Americans, that “someone” is WM, the largest among America’s major waste-hauling companies, with around 31.7% market share.
Beyond the prospect of “sticky” revenue tied to long-term consumer contracts, WM also has an inflation-based tailwind at play right now. As the company’s pricing can be affected by increases in CPI, inflation can have a positive impact on the top line. Even as WM’s own costs are rising due to inflation, it hasn’t experienced a margin squeeze.
Today’s Change
(-1.23%) $-2.77
Current Price
$222.76
Key Data Points
Market Cap
$91B
Day’s Range
$222.12 – $226.29
52wk Range
$194.11 – $248.13
Volume
51.4K
Avg Vol
2.2M
Gross Margin
29.17%
Dividend Yield
1.57%
Instead, as discussed in WM’s most recent quarterly earnings release, margins continue to rise thanks to cost discipline and other measures. During the 2026 first quarter, WM reported a 70 basis point improvement in its earnings before interest, taxes, depreciation, and amortization (EBITDA) margin. For the quarter, revenue was up 3.5% while earnings were up 8.4%.
stock may appear pricey at 27 times forward earnings. But as growth remains consistent and resilient to factors like high inflation, this premium multiple appears sustainable. Even if valuation stays constant, earnings growth could drive further gains over time, with WM’s 1.7% dividend providing an additional boost to long-term total returns.
Consider WM a top inflation-resistant name among industrial stocks.
