Think we're headed back into a recession? A lot of investors do. They are buying the most defensive, recession-proof names they can get their hands on. That means consumer staples names Colgate Palmolive (NYSE:CL) and Coca-Cola (NYSE:KO)
are quickly coming back into favor; both are knocking on the door of
new highs. Makes sense, as it's unlikely consumers will give up the most
basic daily things - no matter how deep the economy sinks.
There's
another group of stocks that do just as well in a recessionary period
though, and these corporations don't make anything you can eat or clean
yourself with. In fact, these companies don't even target consumers at
all - at least not individual consumers.
Corporate StaplesIn the same sense that the average
consumer just isn't going to give up food or hygiene no matter how
tough times get, some corporations can't give up something they've grown
quite accustomed to as well - their technology. Specifically, a whole
host of enterprises are quite married to their software-as-a-service and
database management service, so much so that they couldn't get rid of
it if they wanted to. (more)
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