Dividends4Life: 3 Ultra-Safe Dividend Stocks to Own for Recessions

Dividend Growth Stocks News

The United States economy has not been in a recession since 2009. Seven years have passed since the last recession. The longest the United States economy has ever avoided a recession is 10 years (March 1991 to March 2001). Of course no one knows exactly when the next recession will occur. But prudent investors will be prepared by investing in recession resistant stocks. These are businesses that provide low prices. They sell the type of goods that consumers don't cut back on -- regardless of the overall economy. In fact, these companies saw rising earnings-per-share during the Great Recession of 2007 to 2009 -- when many businesses were struggling just to keep their doors open.

Walmart Stores (WMT) is a pillar of stability when times get tough. As the world's largest discount retailer, Walmart's financial performance typically runs contrary to the condition of the broader U.S. economy. Walmart's strongest period of share price outperformance tends to come when the U.S. economy is in decline. McDonald's (MCD) earnings behave similarly to Walmart's, in the sense that its strongest outperformance relative to the broader market occurs in times of economic downturn. When the economy is doing well, consumers opt for pricier dining options like casual restaurants. But when the economy enters recession, consumers increasingly resort to fast food. Like McDonald's, The Coca-Cola Company (KO) is hurting from the shift in consumer eating and drinking habits. Consumers are purchasing less soda-in fact, Beverage Digest reported that U.S. soda sales have declined every year for the past 11 years, and last year hit a 30-year low.

Source: The Street

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