The United States is heading straight into a recession.
Here are 5 recession-proof stocks I own: 🧵
American Express thrives both in inflation and in recession.
Its commission-based model protects the downside in recession, as its user base is wealthier than that of Visa and Mastercard.
It also thrives in inflation as the dollar value of its commissions grows as the basket totals grow.
Currently fairly valued at $265, I would buy more if the forward P/E drops below 15, meaning below $230 will be a great entry point.
Image
Healthcare outperformed in all previous recessions.
Despite all the negative sentiment around the company, it's the best healthcare business out there.
It has lower prices than most competitors, and its claims denial rate is lower than Kaiser Permanente, the company considered the gold standard in healthcare.
It added a record number of new clients last quarter and only missed earnings guidance because of the increased activity rate.
It's undervalued at 14 times forward earnings on a 10-15% long-term earnings growth estimate.
Image
3.
$Hims & Hers Health Inc.(HIMS)$
It's rapidly becoming an all-in healthcare system.
A recession may actually benefit its business rather than hurting it for two reasons:
1) People prioritize healthcare products in recessions.
2) It's the cheapest cost alternative for most of the solutions it provides.
Further, more than 50% of all its subscribers are on the personalized plan. Those didn't sign up for all that personalization to ditch it fast. They would rather cut other spending.
As the leading provider in the market, it can also gain market share from others as returns per ad spend will decline substantially, and the leading company will therefore capture more of the organic demand.
Image
4.
Direct-to-consumer health insurance provider.
A recession can significantly benefit it for two reasons:
1) People will increasingly sign up and pay the premiums as the ACA enhanced subsidies are still alive, fearing macro environment will get worse.
2) More employers will implement reimbursement plans instead of providing one-size-fits-all benefits to alleviate costs, benefiting Oscar's ICHR business.
Extremely undervalued at just 6 times projected 2027 earnings.
Image
5.
People can't ignore having their insurance going into a recession.
Lemonade has lower gross loss ratios due to its AI-driven approach and its policies, on average, 68% cheaper than its competitors.
It's already cash-flow positive, and it can even benefit from recession as people will increasingly seek cheaper policies.
Image
Open a CBA today and enjoy privileges of up to SGD 20,000 in trading limit with 0 commission. Trade SG, HK, US stocks as well as ETFs unlimitedly!
For whom haven't open CBA can know more from below:
Find out more here：
Comments