While all stocks present potential investor risk, some have traditionally fared better than others, during down markets. The following five stocks appreciated in value, from 2007-2009, holding up exceptionally well during the 2008 financial crisis.
These names are all dividend-paying stocks, consequently providing income to investors, regardless of their performance. (Unless otherwise stated, all data is current as of August 29, 2019.)
- These five stocks not only performed well during the 2008 economic crisis but also pay dividends, earning investors a regular income: Consolidated Edison, Inc. Becton, Dickinson and Co., Abbott Laboratories, Automatic Data Processing, Inc., and Colgate-Palmolive Co.
- In bruised economies, these stocks are likely to hold up much better than the vast majority of stocks throughout the broader market.
Consolidated Edison, Inc. (ED), a utility company that services New York City and Westchester, New York, generates $12 billion in annual revenue. With $29.3 billion in assets, ConEd’s stock appreciated 10.51% from 2007-2009. Looking ahead, the company aims to increase system reliability, technology, and online services, by hiking rates an average of 3.2%.
- 52-week high: $90.51
- 52-week low: $73.30
- Average trading volume for the last three months: 1.57 million
Becton, Dickinson and Co.
Becton, Dickinson and Co. (BDX) develops, manufactures, and sells medical devices, instrument systems, and reagents, on a worldwide basis. From 2007-2009, the stock appreciated 17.49%.
In 2014, Becton Dickinson acquired CareFusion Corporation (CFN), which that year delivered a Q2 year-over-year revenue increase of 16% and an EPS increase of 83.3%. Soon after, CareFusion signed an exclusive distribution agreement with Breas Medical for ventilation equipment, expanding its customer base.
- 52-week high: $265.87
- 52-week low: $208.62
- Average trading volume for the last three months: 1.05 million
The generic drug market continues to thrive, and Abbott Laboratories (ABT) is well-position to capitalize on that trend. As cost-conscious Baby Boomers march towards retirement, generic drugs are likely to remain in high demand, as these pharmaceuticals offer similar strength, quality, and performance characteristics of prescription drugs, for a fraction of the price.
- 52-week high: $88.76
- 52-week low: $65.22
- Average trading volume for the last three months: 5.06 million
Automatic Data Processing
Automatic Data Processing, Inc. (ADP) may be viewed as the riskiest stock on this list, but nevertheless offers higher-than-average resilience, during shaky economies. For example, its share price appreciated 6.61% from 2007-2009.
- 52-week high: $172.00
- 52-week low: $121.40
- Average trading volume for the last three months: 1.93 million
Colgate-Palmolive Co. (CL) was extremely resilient during the Financial Crisis. On June 30, 2008, it closed at $37.68. On Jan. 1, 2009—a notoriously difficult time, it closed at $29.49. And on March 31, 2009, when the crisis was at its worst, the stock price closed at $35.37.
Regardless of economic conditions, consumers continue to purchase toothpaste, mouthwash, dental floss, soap, deodorant, household cleaners, dishwashing liquid, and other home and hygiene essentials.
- 52-week high: $76.41
- 52-week low: $57.41
- Average trading volume for the last three months: 3.26 million
When choosing dividend stocks, investors shouldn't solely target high-yield names, because businesses that pay shareholders too high a percentage of profits may not be adequately reinvesting enough capital back into their business operations.
The Bottom Line
In bruised economies, these stocks are likely to hold up much better than the vast majority of stocks throughout the broader market. Furthermore, any dips in share price may be regarded as buying opportunities.
Dan Moskowitz does not have any positions in ED, BDX, ABT, ADP, or CL.