The recession is officially here.  J.P. Morgan’s top financial analysts recently stated it will take upwards of a decade or longer for the United States economy to return to its pre-coronavirus activity level.  In other words, a prolonged recession or possibly even a brief depression are right around the corner.  However, this does not mean you have to lose your shirt in the market.  Savvy investors will find a way to amass gains regardless of how long it takes for the economy to recover.

It has never been more important to balance your risky investments with value stocks capable of maintaining their worth or even moving upward if the recession lasts as long as J.P. Morgan’s brass forecasts.  Coca-Cola, Johnson & Johnson and Verizon are three such recession-resistant stocks.  Let’s take a look at why consumers will continue to spend for these companies’ products and services no matter how deep the economic trough goes.

Verizon (VZ)

Even if the economy transitions from a recession to a depression, people will still need to communicate with one another.  Furthermore, people will continue to use the internet, watch TV and pay for cable channels as they will be homebound for lengthy periods of time.  These extended stays at home will inevitably result from unemployment, underemployment and potential forced quarantines.

VZ provides the communications, internet and TV services the masses are happy to pay for.  VZ has a solid B POWR Rating with an A Peer Grade and an overall rank of 3 out of 24 domestic telecom stocks.  VZ’s POWR Rating might even increase this year as the company rolls out its 5G service.  Aside from VZ, only two other telecoms provide nationwide 5G service in the United States.

Currently priced at $55, the high forecast for the stock is $70 as detailed on TipRanks.  Check out VZ’s one-year chart and you will see the stock has a clear floor around the $50 level but for the March selloff that impacted all stocks.

Dividend investors love the fact that VZ provides a solid dividend of 4.4%.  Furthermore, VZ is currently a component of the Reitmeister Total Return portfolio, giving investors even more reason to secure a position in this telecom giant.

Coca-Cola Company (KO)

We all need or at least desire soft drinks, sparkling beverages, water and tea.  These are just some of the products KO sells.  The average consumer buys at least one KO product in each of his or her trips to the grocery store, convenience store, shopping mall food court, fast food restaurant or other food-related establishment.

KO dipped to $37.56 in mid-March then quickly bounced right back up to its current level of $45.  The POWR Ratings have KO ranked #9 of 28 stocks in the beverages sector, meaning it is more attractive than two-thirds of its competitors.  Even if the economy continues its slide, people will still buy KO products.

KO boosted its dividend earlier this year, largely due to its across-the-board success in markets throughout the world.  All in all, KO has increased its dividend for nearly 60 years straight.  Buy this stock today, hold it through the recession and you should make money.

Johnson & Johnson (JNJ)

It is not often that you find an oft-overlooked and reasonably priced market darling that scores As across the POWR Ratings board.  JNJ is this mystery stock.  The POWR Ratings have JNJ ranked #1 of 214 stocks in the medical-pharmaceutical category.

JNJ is trading slightly under $150 yet TipRanks’ average analyst price target for the stock is $163.42.  JNJ makes and sells hundreds of consumer products ranging from band-aids to face washes and beyond.  This well-diversified product line is chock full of consumer essentials that will be purchased in large numbers no matter how bad the economy gets.

Furthermore, JNJ scientists are hard at work developing a vaccine to thwart the coronavirus.  Investors should buy JNJ without hesitation, knowing this stock is likely to at least hold its value – if not increase – as the economic drama plays out.

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VZ shares were trading at $55.30 per share on Wednesday morning, down $0.16 (-0.29%). Year-to-date, VZ has declined -8.02%, versus a -10.92% rise in the benchmark S&P 500 index during the same period.

About the Author: Patrick Ryan

Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management. More...

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