Stocks that Beat the Recession Historically

Three of our top recession-proof stocks. Chart analysis, past performance, and more.

September 15, 2022
PB Team

2022 has been a very bearish year in all facets of the stock market. During these times, we are facing, interest rate hikes, an uncertain conflict in Ukraine, and an inflation elevated so much so that many investors are preparing for a potential U.S. recession coming over the next short while.

In these kinds of markets, it does not matter how high quality a stock might be, even the most highly valued stocks are drug down within this selloff. So, what is the solution for investors?

The following is a list of stocks that beat the market, or perform better than a red market, therefore dubbed as recession proof. The following is a list of three stocks to keep your eye on in the coming weeks to months if we continue to sit within this bearish market, amidst the swirl of fear-based news and sentiment.

1. Procter & Gamble (NYSE: PG)

Sector: Consumer Staples
other stocks within Consumer Staples: ADM, COST, TSN

During a recession, consumers tighten up their wallets, cutting back on frivolous and entertainment items, however, at the same time, daily use goods such as household, food, paper, and personal care items remain steady sellers and are in any budget, no matter how tight it may be.

PG is a company that is at the helm of a variety of everyday brands such as Tide, Bounty, Crest, Oral B, Charmin and Tampax. This company benefits from inelastic demand, meaning the demand is there no matter what economic variables exist, therefore display a solid foundation to outperform the market over the following months.

A couple other details about PG that are intriguing in a bear market is a 2.19% dividend along with 14 quarters of consecutive revenue growth.

PG chart analysis

Ideal entry under $140
We have some support at the $138 level
price targets are $152 and $160
If we experience selloff, I expect to find a bottom at $135

2. WalMart (NYSE: WMT)

Sector: Consumer Discretionary
other stocks in Consumer Discretionary: eBay, FL, F

Walmart operates the largest chain of retail stores in the US. With a discount pricing model, supercenters that carry all items creating one stop shopping, and a large investment in their omnichannel retail experience. If you go back and look at WMT performance in recession periods historically, they have always overperformed vs the market. Walmart has also taken steps towards taking on their largest competitor, Amazon, with their expansion of online ordering with same day and next day delivery. In a recession, the exceptionally lower prices, one stop shop style, and scope reached with everything from price matched pharmacy to same day delivery, WMT is the consumer go to in trying economic times, ensuring strong stock performance. With 148B revenue and 4.5% year over year growth, WMT is a top recession proof stock to consider owning.

WMT chart analysis

Ideal entry under $130
We have some support at the $125 and 130 level
price targets are $142 and $160
WMT is sitting at a major point of confluence right now, if we dip under $130, wait until the bottom is in $115 for long term buys

3. Verizon (NYSE: VZ)

Sector: Telecommunications
other stocks within Telecommunications: NTTYY, T, TMUS

VZ business as a telecom industry leader, we have seen historically how recession proof VZ has become through their stability in stock price, as well as unwavering demand within a fearful and frugal spending time for most working-class Americans. In the information age, cellphone service has evolved from something chosen to a household staple. Cellphone usage and by proxy the communication companies that provide service have outpaced landline communication in what the average household uses for their tele needs. Thus, making telecommunication companies a basic household staple, budgeted into even the most fiscally conservative times in the market and economy. VZ outperformed the market in 2020 with a 7% loss vs a 17% spy move and has displayed a consistency in the stock price in a 30% range whereas many tech centric companies are down 50-75% from their 2021 highs, making VZ outperform on a 2/1 pace.

VZ chart analysis

Ideal entry under $43
We have some support at the $41 level, price targets are $48 and $55 VZ is a range bound stock, which is perfect for lower risk, outpacing of a bear market, also, we have a double bottom in play here, indicating the strong possibility of a reversal after sell off.

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