Recession is a terrifying word for businesses and investors. However, you can do plenty to help protect your assets and your portfolio when times are tough. Some products and services are frivolous or more vulnerable than you might think, but others are essential to everyday life and doubly so in a recession. People will always need to clean and eat. Moreover, they’ll always need trash services, and recessions often see a rise in at-home entertainment and exercise. Here are the top ten stay-at-home stocks that should be recession-proof.
10. Amazon: AMZN
Everyone knows what Amazon is and what it does. However, you may not have considered that this megacorp is virtually recession-proof. Especially in the COVID-19 era, people want more products delivered to their homes rather than going out to get them. Last year alone, this company made 386.1 billion USD. Plus, it employs almost one and a half million people.
9. Clorox: CLX
Clorox bleach is practically synonymous with clean. Whether the economy is booming like never before, everyone goes into lockdown, or the country has the worst recession since the Great Depression, people still need basic sanitation. Bleach is one of those staple items that people keep needing even when frivolous spending is curtailed. Moreover, the Clorox company sells numerous professional and household products that are essential.
8. Costco: COST
It’s no surprise to anyone that food is non-negotiable for people regardless of the economic state. However, when times are tough, people look for ways to save, and one of those methods is bulk buying. According to Costco.com, ” As of 2020, Costco was the fifth largest retailer in the world, and the world’s largest retailer of choice and prime beef, organic foods, rotisserie chicken, and wine as of 2016.”
7. Campbell Soup: CPB
Campbells is synonymous with soup. This company, founded in 1869, has weathered economic ups and downs for well over a century. Over the years, the processed food and snack company has acquired and merged with several others to become one of the United States’ largest processed food retailers. A food business is a reasonably safe investment regardless of a recession because people will keep eating. Plus, inexpensive, premade meals and snacks are always popular.
6. Activision Blizzard: ATVI
When you’re sitting at home bored, you might read a book or listen to the radio. However, most people turn on the television instead. Some of those people watch cable, free, or streaming services, but others are looking for some adventure. When the world outside your window seems alarming or lackluster, engaging with a rich fantasy world can lift your spirits. Activision Blizzard is the world’s biggest interactive entertainment provider. Better still, ATVI is a member of the Fortune 500 and S&P 500.
5. Waste Management: WM
Wherever there are people, there is garbage. Someone has to deal with all of it, and WM has made it their business to be that ‘someone.’ Without essential services like trash pickup services, cities would be nothing more than open-air dumps with residents. You can find this crucial company all over the US handling vital services to individuals and corporations alike. In its own words, Waste Management “… is the leading provider of comprehensive waste management, offering services such as garbage collection and disposal, recycling and dumpster rental.”
4. Johnson & Johnson: JNJ
A lot of people hear Johnson and Johnson and automatically think of baby products or Janssen Pharmaceuticals, which is a subsidiary of the larger JNJ. Babies and sick people don’t stop having needs when a recession hits. However, after 2020, we also think of vaccines, and that alone would be more than enough to help keep this massive corp mostly recession-proof, at least for a few years. The US vaccine efforts are going well, but there are plenty of places worldwide that are still waiting their turn to get life-saving vaccines.
3. Walmart: WMT
Before Amazon Prime was ever a twinkle in Bezo’s eye, the Walton family had stores all over the country selling affordably priced products to people everywhere. Times have changed, and Walmart isn’t the only megacorp around, but it still has a massive slice of the pie. You can shop in person or order just about anything you need from Walmart online. Get an entire DIY shed, toys for the kids, work clothes, or a movie and a bath bomb for a relaxing evening, or all of those things in a single stop. Moreover, WMT delivers groceries, a corner of the market where AMZN famously struggles to get a foothold.
2. Peleton: PTON
Working out at home is either a dream come true or incredibly difficult and destined to fail for most people. Those in the former category do just fine with free weights and a nordic track. For those who want or need a little more motivation, there’s Peleton. This ingenious company offers internet-connected sports equipment that comes with a subscription fee. Attending virtual classes can help people meet their fitness goals without wasting time going to the gym. People are certainly not about to stop buying at-home workout equipment.
1. DocuSign: DOCU
If you’re old enough to remember a time when the only way to sign a document legally was in person, then you know how frustrating and slow the process could be. Faxing things made the process easier, but it wasn’t until e-signatures became the standard that legal processes were genuinely streamlined. Thanks to DocuSign, you can now make a deal via Skype or Zoom and sign it before the meeting is over or rent an apartment on the other side of the world. Recession or not, contracts are a part of life.
The downside to investing in stay-at-home stocks that should be recession-proof is that they may underperform when there’s no recession. Moreover, there’s always a risk in investing. Even the most supposedly recession-proof stock is subject to the whims of the market. It is vital to do your own research, talk to a financial advisor, and especially understand the risks of investing before you ever choose a stock. That said, stay-at-home stocks are among the safest options for a recession.