7 Safe Stocks to Shield Your Portfolio Against the Next Big Crash

safe stocks - 7 Safe Stocks to Shield Your Portfolio Against the Next Big Crash

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There was already reason for markets to be jumpy. But another big one was added to the list — the president’s diagnosis of Covid-19, the disease created by the novel coronavirus. We’ll see how this all plays out, but it’s precisely this uncertainty that markets dislike. Markets prefer clarity and when that doesn’t happen, things can get ugly. This has driven many investors to seek safe stocks to buy.

It’s also a reminder for why it’s always important to have companies in your portfolio that have the ability to steer through storms because of the way they’re positioned in specific sectors.

Many of these firms are not typically sexy, but if things turn dark in the markets, your view of sexy will change quickly. These kinds of stocks become your “bragging stocks,” when it’s less about how much you’ve gained than how much you’ve lost.

These seven safe stocks will help shield you against the next big crash. They will anchor your portfolio in solid sectors with reliable long-term growth … and a little cash along the way:

  • Apple (NASDAQ:AAPL)
  • Microsoft (NASDAQ:MSFT)
  • Procter & Gamble (NYSE:PG)
  • Linde PLC (NYSE:LIN)
  • UnitedHealth Group (NYSE:UNH)
  • Sherwin-Williams (NYSE:SHW)
  • T Rowe Price Group (NASDAQ:TROW)

Safe Stocks to Buy: Apple (AAPL)

White Apple (AAPL) logo on glass with people in background
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I don’t think I really have to go into too much detail on what this company does or how dominant it is. Its $2 trillion market cap speaks to that pretty clearly.

The fact that when the S&P 500 readjusted its weightings earlier this year, it added more weight to tech stocks like AAPL, further cements its position as one of the world’s most dominant companies.

That means every fund and exchange-traded fund that tracks the S&P 500 had to up their weightings in the stock (directly or synthetically) as well. Also consider that in this market, with a whole slew of new investors rolling their cash into stocks for the first time, they buy the names they know.

As we’ve seen time and again with AAPL stock, very little will hurt this stock for more than a quarter or two, and then it’s off to the races again. And now that it’s in the center of one of the world’s leading indexes, that certainly helps even more.

AAPL stock is up over 100% in the past year and carries a slight dividend of 0.7%.

Microsoft (MSFT)

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Along with AAPL, MSFT is another weighted S&P 500 beneficiary.

Its $1.6 trillion market cap puts it in a league with few other companies. It’s hard to imagine that 6 years ago, the company was hardly on its way to these lofty heights. It had spent years battling the U.S. government over anti-competitive practices and trying to remain relevant as the second wave of the digital revolution began.

But when Satya Nadella was appointed CEO, all that began to change. He restructured and refocused the company into what we see today — a dominant force in hardware, software and cloud computing.

Today, it has significant competitive moats in a number of sectors and continues to grow its customer bases in all of them. These factors make it one of the more exciting but safe stocks on the market today.

MSFT stock is up 54% in the past year and offers a 1% dividend.

Procter & Gamble (PG)

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There are a select group of companies that are called dividend aristocrats. They’re stocks in the S&P 500 that have increased their dividend annually for 25 year or more.

There are a handful of companies called dividend kings. They have consistently raised their dividend annually for 50 years or more. PG stock is one of those kings.

As a matter of fact, PG has been paying a dividend for more than 130 years. And it has been in business since 1837, when Andrew Jackson lost to Martin van Buren.

Needless to say, PG has been able to weather a lot of storms and build a product line that can generate revenue in good times and bad. And it did this relying on U.S. consumers (at least in the early days) that trusted its brands for getting the job done at a fair price.

Consumer staples gets lost in the big rallies, but it continues to shine whether anyone is watching or not.

PG stock is up just 12% in the past year and delivers a rock-solid 2.3% dividend.

Linde PLC (LIN)

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For a company that began in 1907, you don’t hear a lot about it. Although over those years it has gone by various names. It was once a division of Union Carbide. And before its most recent name change, it went under the name Praxair.

But over more than a century it has focused on industrial gasses. It landed on its current name when German industrial giant Linde merged with Praxair in 2017 and the current Ireland-based company was born.

It now arguably the largest industrial gasses company in the world.

What are industrial gasses? Fundamentally, they’re oxygen (think healthcare), carbon dioxide (drinks), nitrogen (fertilizers), argon (metals and manufacturing), hydrogen (energy), helium (coolant and welding) and acetylene (automotive and pharmaceutical).

That is a list of the foundational sectors in all economies around the world. And those sectors diversify the company across markets as well as industries. All of that adds up to make LIN one of the better safe stocks to consider in this uncertain market.

LIN stock is up 23% in the past year and delivers a 1.3% dividend.

United Health Group (UNH)

The UnitedHealth (UNH) headquarters in Minnetonka, Minnesota.
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UNH is the largest healthcare insurance provider in the world by revenue. And given the shaky state of U.S. healthcare right now, there’s one piece of good news for healthcare insurers. Both presidential candidates aren’t looking to rebuild the current system and move toward public healthcare.

That means UNH keeps its current base of private insurance and it helps distribute and manage Medicare and Medicaid.

What’s more, in 2011, UNH launched Optum. This division that helped manage technology related solutions for healthcare providers, customers and insurers, also launched OptumRx.

This division is a pharmacy benefit manager and has been a significant growth engine to its insurance business. Basically, it can decide what kind of drugs will be covered and how much the insurance side will pay for a drug. That is a significant business.

UNH stock is up 41% in the past 12 months and has a 1.6% dividend.

Sherwin-Williams (SHW)

A Sherwin-Williams (SHW) sign in Richfield, Minnesota.
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Here’s another company that has been around since the early days of the Civil War.

Remember, back then there was no Federal Reserve (for good or bad) to manage money supply and the economic booms and busts were massive, and regular. Add in the devastation of the country’s bloodiest war and the economic rebuilding necessary after it.

That’s when businesses look for a stable product line that can not only endure in uncertain times, but can thrive despite them.

Yes, SHW sells paint to both consumers and industry. But again, in this pandemic, housing sales are up, and home repair is up. That’s a very good thing for SHW stock, and it’s in large part why I consider it one of the safe stocks you can consider buying now.

The stock is up 26% in the past 12 months and has a 0.8% dividend.

T Rowe Price (TROW)

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How many 83-year-old, financial services companies with $1.3 trillion of assets under management do you know that have their headquarters Baltimore, Maryland?

Well, you now know of one.

And to be honest, it has 16 international offices, serving 47 countries. Oh, and its founder, Thomas Rowe Price, is credited with developing the concept of growth stock investing.

Even more interesting, while most financial services companies have been building out their passive investment vehicles (index funds, etc.), TROW remains a staunch believer in actively managed funds. And its funds are generally lower cost than many competitors that have passively managed funds.

TROW stock is up 16% in the past year, and has a respectable 2.8% dividend to boot.

On the date of publication, Louis Navellier had a long positions in MSFT. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article. 

The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article. 

Louis Navellier had an unconventional start, as a grad student who accidentally built a market-beating stock system — with returns rivaling even Warren Buffett. In his latest feat, Louis discovered the “Master Key” to profiting from the biggest tech revolution of this (or any) generation. Louis Navellier may hold some of the aforementioned securities in one or more of his newsletters.


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