In my capacity as Chief Investment Strategist, I’m often asked to recommend stocks that will “beat the market” or “withstand a trade war with China” or – as of late – be “recession-proof” – a thought on the minds of many given the prospect of a Fed rate cut.
In fact, it’s the closest thing out there to a recession-proof stock as I can find. Not only that, but it’s a company that’s delivered more than 291% in gains on a special move we’ve made in the past.
It’s still perfectly positioned for profits, and as you’ll see in a second, it likely will be for a long time to come.
Before I tell you what it is, though, let’s talk for a moment about why this matters…
It’s Virtually Impossible to Predict a Downturn
Nobody knows if there’s a recession ahead. That’s pure speculation, and it doesn’t matter whether you’re getting that information from the mainstream media, from cable pundits, from chat rooms… even from your favorite madcap relative.
The private National Bureau of Economic Research (NBER) defines a recession as a “significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.”
For folks like you and me, from a practical standpoint, recession happens when economic activity slows and people buy less for at least six months or two consecutive quarters.
However you define them, recessions come and go, often without warning. So surviving them is a matter of perspective.
There have been 11 recessions since the end of WWII, but just three in the past 30 years:
- The oil shock of 1990-1991
- The dot-com collapse in 2001
- The financial crisis “Great Recession” of 2008-2009
Of course, the proximate causes of the three recessions were all different, but the best-performing investments to hold during those slowdowns have something in common.
In fact, the best things to look for mirror the stuff we talk about frequently: companies making must-have products and services the world cannot live without, whether there’s a recession or not.
In the past, I’ve suggested companies like Becton Dickinson & Co. (NYSE: BDX), which makes medical devices and instrument systems, and Altria Group Inc. (NYSE: MO), which makes, among other things, cigarettes.
Altria, for example, has given Money Map Report readers following along more than 284% in gains, which speaks to its “must-have” nature. Just as impressive have been the 276% gains from BDX shares.
Think about it: Logically, tens of millions of people will need insulin syringes whether the economy is doing +3% annually or -0.50%. And tobacco users actually tend to smoke more when the economy gets womped.
Right now, I’m recommending another company with a must-have “product.”
The Trash Must Be Taken Out
This time around, I think the play is Waste Management Inc. (NYSE: WM). If you’re subscribed to our free “video trading” Fast Profits service, you definitely remember Waste Management – because we made a quick 291% gain there in 2018.
The forecast for 2019 and beyond looks even better.
That said, the amount of trash tends to decrease during recessions because people buy less, but that doesn’t change the fact that we still have to deal with it.
The company operates in 48 states and has a $14.91 billion topline. Profits have grown 19.77% over the past four years, and the 1.79% dividend is attractive, too.
Will Waste Management get “hit” during a recession?
Probably.
Today’s computerized markets make it hard to hide anywhere, so don’t expect the company’s price to remain immune to a broader sell-off. But do expect it to be more stable.
That’s the key here when it comes to recession-proofing your portfolio.
You’ve got to think about stability first because that’s what will help you and your money come roaring back farther and faster than folks who run for the hills.
— Keith Fitz-Gerald
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Source: Money Morning