10 Recession Stocks With Proven Performance in Bear Markets

As concerns about economic contraction heat up and market downtrend moves into bear territory, there’s one word on many investors’ minds: recession. A recession tends to send stock prices plummeting, causing everything from stock capitulation to movement into safe haven investments like commodities. But it’s important to remember that not every stock will crash. In fact, there are recession stocks out there that perform consistently (if not better) during bear markets.

If you’re looking to add a few recession-proof stocks to your portfolio, start by looking at these 10 companies. Not only are they insulated against most forms of economic turbulence, many of them have weathered recessions before, proving that they can.

10. Philip Morris International Inc. (NYSE: PM)

If you operate an ESG portfolio, you might consider leaving this stock off your watchlist. That said, Philip Morris International offers plenty of opportunity in a down market. The company is extremely well-run and surprisingly diversified across vices, with significant interests in cigarettes, smokeless products, beer and alcoholic beverages, food and more. Incorporated in the early 1900s, PM has also weathered every major recession in history.

9. Kellogg Company (NYSE: K)

People will always need to eat, and Kellogg owns a significant segment of the grocery store—specifically in the breakfast aisle. From Pop-Tarts to Eggo Waffles, Keebler to Rice Krispies, Kellogg is a consumer brand that tends to see consistent and even strong sales during times of economic downturn. As people pinch pennies at the store, they find affordable value in Kellogg products.

8. General Mills Corporation (NYSE: GIS)

Right alongside Kellogg in the grocery store you’ll find General Mills. In fact, General Mills is roughly double the size, with products that stretch across virtually every segment of the grocery store. General Mills even owns pet and beauty brands, to diversify its exposure ever further. As is the case with other food manufacturers, recessions have less of an impact. People need to eat!

7. Waste Management (NYSE: WM)

Waste Management isn’t just a company that thrives during a recession. It’s also an unrivaled player with a huge moat in the garbage collection and recycling sector. The barrier to entry for this industry is so high that WM is effectively a monopoly in many areas and part of a duopoly in others. In many ways, it’s akin to a utility stock. As is the case with most stocks on this list, just because the economy slows doesn’t mean garbage collection does.

6. Procter & Gamble Co. (NYSE: PG)

Procter & Gamble is an absolute powerhouse company to own during a recession. Not only is it a Dividend Aristocrat, the company’s stock price tends to remain stable as the broader market fluctuates and flounders. With annual profits of more than $14 billion, PG is a bellwether in any portfolio. It doesn’t hurt to be the number one retailer of grooming, hygiene, personal care, baby and home care products.

5. Dollar General Corp. (NYSE: DG)

When recession hits, people want more bang for their buck. They’re on the hunt for deals and steals, and they’ll find them at Dollar General. Discount retailers like DG flourish as the economy slumps, attracting new and recurring customers with the promise of value. With relatively low operating costs and high profit margins, investors can expect standout performance from Dollar General, even while other retailers post laggard earnings.

4. Dollar Tree, Inc. (NASDAQ: DLTR)

In the same boat as Dollar General, you’ll find Dollar Tree. The discount retail space is big enough for two major players during a recession, and both companies will find themselves with plenty of patronage. Really, the biggest challenge facing Dollar Tree in the pending economic downturn is supply chain constraints, which could both raise the cost of its inventory and disrupt cash flows. Nevertheless, Dollar Tree has historically performed well during recessionary periods.

3. Costco Wholesale Corporation (NASDAQ: COST)

Right alongside discount retailers in a recession are bulk sellers, and Costco is king among them. Costco is already wildly popular, and it’s about to gain a new crop of members as the economy begins to slump. Here again, people want more for their money and Costco quite literally offers bulk value. With more signups comes more member revenues, which is what Costco thrives on. It’s a win-win for consumers and the company.

Recession Stocks During an Economic Downturn

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