Defensive stocks are shares of companies that are considered to be relatively resilient to economic downturns. During times of stock market turbulence, defensive stocks tend to perform well, as investors seek out companies with a history of stability and consistent dividend payments. Specifically, defensive stocks typically belong to industries that are considered essential, such as healthcare, consumer staples, or industrial.
While defensive stocks may not offer the same upside potential as more aggressive investments, they can provide a measure of downside protection during market corrections. For these reasons, defensive stocks are often favored by risk-averse investors. However, it should be noted that even the most defensive stocks can lose value during prolonged periods of market volatility. With that being said, here are three defensive stocks for your list of stocks to watch during a recession in the stock market today.
Defensive Stocks To Watch In October 2022
- FedEx Corporation (NYSE: FDX)
- General Motors Company (NYSE: GM)
- AbbVie Inc. (NYSE: ABBV)
1. FedEx (FDX Stock)
First, FedEx Corporation (FDX) is an American multinational delivery services company. Corporation provides a variety of services, including FedEx Express, FedEx Ground, FedEx Freight, and FedEx Office. FedEx Corporation also offers a number of other products and services, including logistics, e-commerce, and transportation.
FDX Recent Stock News
Just last month, FedEx Corp announced a miss for its 1st quarter 2023 financial results. Getting straight to it, FedEx (FDX) reported first-quarter 2023 earnings of $3.44 per share with revenue of $23.2 billion. For context, analysts’ consensus earnings estimates were $3.43 per share on revenue of $23.6 billion for Q1 2023. Additionally, the company was able to grow revenue by 5.4% during the same period, a year prior.
Next, FedEx provided guidance for its second quarter of 2023 earnings. Specifically, the company said it maintains its Q2 2023 estimates, which are earnings of $2.75 per share, and revenue between $23.50 billion to $24.00 billion.
Raj Subramaniam, FedEx Corp. President & CEO commented this about the quarter’s performance, “We’re moving with speed and agility to navigate a difficult operating environment, pulling cost, commercial, and capacity levers to adjust to the impacts of reduced demand. As our team continues to work aggressively to address near-term headwinds, we’re meaningfully strengthening our business and customer experience, including delivering an outstanding peak.”
FDX Stock Chart
Since that report, shares of FedEx stock have dropped over 27%. Meanwhile, on Friday, FDX closed the trading day at $148.47 per share. All in all, do you think FDX stock is a good buy at its current price levels?
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2. General Motors (GM Stock)
Next, General Motors Company (GM) is one of the world’s largest automakers, with operations in more than 100 countries. The company’s products include cars, trucks, and SUVs under the Chevrolet, Cadillac, GMC, and Buick brands. In recent years, General Motors has been working to improve its environmental footprint and reduce its reliance on fossil fuels. The company has set a goal of having all of its vehicles be emissions-free by 2035. To achieve this goal, General Motors is investing heavily in electric vehicles and autonomous driving technology.
GM Recent Stock News
In mid-August, General Motors announced its Board of Directors has authorized the reinstatement of a quarterly cash dividend at $0.09 per share on common stock. What’s more, the company also said it will restart its share repurchases. Specifically, the Board of Directors increased the capacity of GM’s current share repurchase program to $5 billion, from the previously announced $3.3 billion.
Mary Barra, GM Chair and CEO stated, “GM is investing more than $35 billion through 2025 to advance our growth plan, including rapidly expanding our electric vehicle portfolio and creating a domestic battery manufacturing infrastructure. Progress on these key strategic initiatives has improved our visibility and strengthened confidence in our capacity to fund growth while also returning capital to shareholders.“
GM Stock Chart
Going into Monday morning’s trading session, GM stock is set to open at $32.09 a share. Though, shares of General Motors stock are still down 52.25% from their 52-week highs. Given this, is now an ideal time to add General Motors stock to your list of stocks to buy during a recession?
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3. AbbVie (ABBV Stock)
Last up, AbbVie Inc. (ABBV) is a research-based biopharmaceutical company. In short, the company founded in 2013 as a spin-off from Abbott Laboratories (NYSE: ABT). AbbVie focuses on developing and commercializing therapies for chronic conditions such as cancer, autoimmune diseases, and virology. Moreover, AbbVie’s research and development efforts are primarily focused on addressing unmet medical needs in these therapeutic areas.
ABBV Recent Stock News
Last month, AbbVie announced its Board of Directors has declared a quarterly cash dividend of $1.41 per share. In the announcement, the company said the cash dividend is payable on Tuesday, November 15, 2022, to stockholders of record at the close of business on October 14, 2022. This results in an annual dividend yield of 4.20%.
In fact, since AbbVie was formed in 2013, it has raised its dividend by more than 250%. Today, AbbVie is a member of the S&P Dividend Aristocrats Index. For the uninitiated, the S&P Dividend Aristocrats Index tracks companies that have increased their annual dividend for at least 25 straight years.
ABBV Stock Chart
Aside from that, ABBV stock has outperformed the broader markets so far in 2022. Shares of ABBV stock are looking to open this new trading week at $134.21 a share. With AbbVie’s strong product portfolio, and financial history do you think ABBV stock is a good defensive stock to buy during a recession?
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