The ASX consumer sector is a popular space for retail investors.
It contains many brands that investors know and recognise. These include consumer staples companies such as the supermarket giants Coles Group Ltd (ASX: COL) or Woolworths Group Ltd (ASX: WOW), as well as discretionary retailers that sell items such as clothing, jewellery, or electronics.
Over the past couple of years, cost-of-living pressures have weighed heavily on many of these companies. Meanwhile, others have been remarkably resilient and have outperformed the market by a wide margin.
Australian investors may be keen to invest in the ASX consumer sector in July, but they are unsure where the best opportunities lie.
Fortunately, this week broker Macquarie Group (ASX: MQG) has named top 3 picks in this sector.
What are they?
Coles Group Ltd (ASX: COL)
The first stock named by the broker was supermarket giant Coles.
Coles is Macquarie's top pick in the consumer staples sector.
Based on industry feedback, Macquarie said that Coles continues to take market share from fellow supermarket giant Woolworths.
The broker also expects Coles' earnings to "benefit from supply chain investments and industry feedback continuing to point to in-store execution."
Macquarie has an 'Outperform' rating and price target of $24.20 on Coles shares.
Harvey Norman Ltd (ASX: HVN)
The second stock named by the broker was Harvey Norman.
Harvey Norman is Macquarie's top pick in the consumer discretionary space.
Harvey Norman offers consumer electronics, appliances, furniture, and homewares.
Macquarie expects Harvey Norman shares to benefit from "a more prolonged recovery across housing-related categories." The broker also expects potential moderation in consumer electronics to be offset by improvement in the "whole at home" categories.
Macquarie has placed an 'Outperform' rating on the stock and price target of $5.90.
Bega Cheese Ltd (ASX: BGA)
Bega Cheese was its third ASX consumer pick.
The company produces and sells a variety of dairy and food products, including household names such as Vegemite, Farmer's Union, and Dare.
Bega Cheese shares have risen 20% over the past 12 months. However, the broker thinks it has further to run.
The broker believes Bega's share price will be driven by "ongoing progress to 2028 targets and upside via M&A" over the coming 12 months.
In its SMID-Cap Best Picks July 2025 report, Macquarie said:
Bega has runway to deliver cost-out in its business through: i) site rationalisation; and ii) operational efficiencies, which will drive gross margin improvement. It has a track-record of executing on its strategy, effectively managing costs, and reducing its manufacturing footprint in the last few years.
Macquarie currently has an 'Outperform' rating and price target of $6.40 on Bega shares.
