The odds of a recession might be increasing. And that’s why it’s important to know which S&P 500 stocks do just fine during the downturns.
Nine stocks in the S&P 500, including Walmart (WMT), J.M. Smucker (SJM) and Ball (BALL), outperform during recessions, says an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSurge. All these stocks beat the S&P 500 in each of the past five recessions. Additionally, they gained an average of 20% or more during the recessions.
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Is A Trump Recession On The Horizon? Here Are The Stocks And Sectors To Avoid.
Now’s the time to prepare for the increasing likelihood of an economic contraction. “Economic data has been showing signs of deteriorating and recession fears have accelerated as a result,” said Megan Horneman, chief investment officer at Verdence Capital Advisors.
How To Know It’s Time To Sell Your Favorite Stock
How To Beat A Recession
If you only own the S&P 500 during a recession, you need to expect some turbulence.
The S&P 500 can struggle mightily during an economic downturn. The market plunged 11.2%, 37.9% and 8.2%, respectively, during the past three recessions.
But a recession doesn’t always spell doom for the S&P 500 — as the market is predicting what the economy will be like in the future six months, not pricing in the past six months. The S&P 500 actually rose 4.8% in the 1990 recession and nearly 7% in the 1981 recession.
So rather than yanking all your money out of the S&P 500 as recession risk rises, it’s smart to know were you can still get a return.
Walmart Is A Recession Favorite Stock
If you’re looking for a place to not just hide from a recession — but profit during one — Walmart is the standout. The retailer posted an average gain of nearly 40% during the past five recessions — which is more than any other S&P 500 stock.
And that makes sense. The consumer staples retailer sells items consumers need no matter what the economy is doing. That includes food and other essentials.
Investors might get a shot at buying Walmart stock. The RS Rating of 86 is strong as is the EPS Rating of 83. Analysts think profit will rise 5% in 2026 and 12% in 2027. The stock is building a flat base at 96.18. A bounce to that level from the 200-day would be bullish.
Other Ways To Play Recession
Investors love to hunker down in a recession. Jam maker J.M. Smucker is another example. Shares of the packaged goods maker gained nearly 36% in the past five recessions. The RS Rating is only 44 and EPS Rating just 65.
But earnings are seen rising 1% this year. Plus shares are up 1.3% this year while the S&P 500 is down. It’s not time to buy, yet, though, as the stock struggles to stay above its 200-day moving average.
No, recessions aren’t fun, especially if you lose your job. But just know you can still make money during one.
Top S&P 500 Stocks In Recessions
All these stocks topped S&P 500 in past five recessions
| Company | Ticker | YTD % ch. | Average % stock ch. last five recessions |
|---|---|---|---|
| Walmart | WMT | -6.5% | 39.5% |
| J.M. Smucker | SJM | 1.5% | 35.8% |
| Ball | BALL | -7.5% | 26.6% |
| Clorox | CLX | -9.5% | 26.2% |
| Baxter International | BAX | 18.5% | 25.4% |
| Kroger | KR | 8.1% | 22.7% |
| Lockheed Martin | LMT | -3.7% | 22.1% |
| Analog Devices | ADI | -4.1% | 21.8% |
| Sherwin-Williams | SHW | 0.6% | 20.1% |
Sources: ETFdb, S&P Global Market Intelligence, IBD
Follow Matt Krantz on X (Twitter) @mattkrantz
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