The 15 Best Recession-Resistant Stocks to Buy
There's little question as to what makes the most recession-resistant stocks to buy so resilient. Many of them offer products that Americans simply can't go without, or that are much more attractive when money is tight.
What's less certain is when investors will need these companies.
The man who predicted the dot-com crash of 2000 and the housing crisis that led to the most recent recession believes the odds of a 2020 recession are less than 50%. "Whether it's coming next year, I can't be sure," Nobel Prize-winning economist Robert Shiller told the Financial News on Sept. 9.
However, a National Association for Business Economics survey found that while economists are modelling a 20% chance of recession by mid-2020, they put the odds at 69% by mid-2021. They also widely see GDP growth slowing from 2.9% in 2018 to 2.3% this year, then to just 1.8% in 2020.
Some are even more pessimistic. Also in September, Jeffrey Gundlach - CEO and founder of DoubleLine Capital LP, a Los Angeles-based investment firm with $140 billion in assets under management - said he believes there's a 75% chance of a recession before the 2020 presidential election.
Here are 15 top recession-resistant stocks to buy if you want to get ahead of the risk. Among the things you should know about recessions: The organization in charge of actually determining whether a recession has occurred typically needs six months to do so. Investors won't know it's happening until it has been underway for quite some time. So if you're looking to protect your portfolio against this risk, you'll want to lean toward being early rather than late.
Walmart
Market value: $333.4 billion
Dividend yield: 1.8%
In times of recession, companies that sell low-priced merchandise typically perform better than those with expensive products. No wonder then, that Walmart (WMT, $117.23) delivered a total return (price plus dividends) of 20% in 2008 while the S&P 500 registered a loss of 37% with dividends included.
While the nature of its business would bode well for its resilience in another recession, Walmart still must deliver the goods. That might be considerably difficult for a stock that's trading near all-time highs, but Strategic Wealth Partners CEO Mark Tepper still has faith in the stock.
"Our favorite staple is Walmart. A huge portion of their business is groceries and people need to eat regardless of the direction of the economy," Tepper in early September. "And in a low-margin business like groceries, it's all about volume, and they're doing everything they can to boost value - rolling out delivery, curbside pickup, all that stuff is helping to boost volume. So I think there's more upside with
You’re reading a preview, subscribe to read more.
Start your free 30 days