When the economy slows down, smart investors shift toward defensive stocks during recession periods. These are companies that provide essential goods and services people continue buying no matter what the market is doing. From healthcare and utilities to consumer staples and discount retail, defensive stocks can help protect your portfolio from volatility. If you’re looking to build a recession-resistant investment strategy, here are the top 10 defensive stocks to consider in 2026, each known for stability, strong cash flow, and long-term reliability.
1. Johnson & Johnson
Johnson & Johnson is one of the most reliable defensive stocks during recession periods thanks to its diversified healthcare business. From prescription drugs and medical devices to consumer health products, demand remains steady even when the economy contracts. Healthcare is non-cyclical, meaning people don’t stop buying medicine during downturns. J&J also has a long history of dividend growth, making it attractive for income-focused investors. Its strong balance sheet and global footprint provide additional stability. For investors seeking recession-proof stocks with consistent returns, Johnson & Johnson remains a cornerstone defensive holding.
2. Procter & Gamble
Procter & Gamble is a classic consumer staples giant, producing everyday essentials like toothpaste, detergent, and diapers. During a recession, consumers may cut back on luxury purchases, but they still buy household necessities. That’s what makes P&G a top defensive stock. The company owns powerful global brands and maintains strong pricing power, which helps protect margins during inflationary or recessionary periods. It also boasts decades of dividend increases, appealing to conservative investors. If you want portfolio stability during economic downturns, Procter & Gamble offers dependable revenue and steady long-term performance.
3. Coca-Cola
Coca-Cola has long been considered one of the best defensive stocks during recession cycles. As a global beverage leader, it benefits from strong brand loyalty and consistent demand worldwide. Even during tough economic times, consumers continue purchasing affordable indulgences like soft drinks. Coca-Cola’s diversified product portfolio and international reach help smooth out regional slowdowns. The company also generates strong free cash flow, supporting reliable dividend payments. For investors seeking recession-resistant dividend stocks, Coca-Cola combines stability, brand power, and global scale in one dependable investment option.
4. Walmart
Walmart often performs well during recessions because consumers trade down to discount retailers when budgets tighten. As the largest retailer in the world, Walmart offers essential goods at competitive prices, making it a go-to shopping destination during economic downturns. Its massive scale allows it to maintain thin margins while still generating strong revenue. Grocery sales, which account for a large portion of its business, remain resilient in recessions. With steady cash flow and consistent dividends, Walmart is a defensive retail stock that can help cushion portfolios during volatile markets.
5. PepsiCo
PepsiCo offers a balanced mix of beverages and snack foods, making it more diversified than many beverage-only competitors. During a recession, consumers continue purchasing affordable snack products and drinks, which supports stable revenue streams. Its Frito-Lay division is particularly strong, providing consistent cash flow even in challenging economic conditions. PepsiCo has a long track record of dividend growth and strong brand recognition globally. For investors looking for recession-proof consumer staples stocks, PepsiCo provides both income potential and defensive resilience across multiple product categories.
6. Costco
Costco thrives during recessions because its membership-based warehouse model offers consumers lower prices through bulk buying. As shoppers become more price-conscious, Costco’s value proposition becomes even more attractive. The company benefits from strong customer loyalty and recurring membership revenue, which adds stability to earnings. Essential items like groceries and household supplies drive consistent foot traffic regardless of economic conditions. Costco’s efficient operations and disciplined management further strengthen its defensive profile. For investors seeking reliable retail exposure during a downturn, Costco remains a solid recession-resistant stock.
7. McDonald’s
McDonald’s often performs defensively during recessions because it offers affordable dining options when consumers cut back on expensive restaurants. The company’s global presence and franchise-based model generate stable cash flow and predictable earnings. Its value menu appeals strongly during economic downturns, while brand recognition remains unmatched worldwide. McDonald’s also benefits from real estate holdings and operational efficiency, adding another layer of stability. For investors looking for recession-proof consumer discretionary stocks, McDonald’s combines affordability, global scale, and dividend reliability in one resilient business model.
8. NextEra Energy
Utilities are among the most defensive sectors during recessions, and NextEra Energy stands out as a leader. Electricity demand remains steady regardless of economic cycles, making revenue relatively predictable. NextEra also benefits from its growing renewable energy portfolio, positioning it for long-term expansion. Regulated utility operations provide stable income streams, while clean energy investments offer future growth potential. Investors seeking low-volatility defensive stocks during a recession often turn to utilities like NextEra for dependable dividends and consistent cash flow.
9. Pfizer
Pfizer is another healthcare giant that tends to hold up well in economic downturns. Demand for prescription medications remains steady regardless of consumer confidence levels. The company has a broad drug portfolio and strong research capabilities, which help sustain long-term revenue growth. Healthcare spending is largely non-discretionary, making pharmaceutical companies inherently defensive. Pfizer also offers attractive dividend income, which can be appealing during volatile market periods. For investors focused on recession-resistant healthcare stocks, Pfizer provides a combination of stability, innovation, and income potential.
10. Colgate-Palmolive
Colgate-Palmolive specializes in everyday consumer staples such as toothpaste, soap, and pet food. These are products people consistently purchase regardless of economic conditions. The company benefits from strong global brand recognition and steady international demand. Its pricing power and operational efficiency help maintain profitability during inflationary or recessionary environments. Colgate also maintains a reliable dividend history, making it appealing for income-oriented investors. If you’re building a portfolio focused on defensive stocks during recession periods, Colgate-Palmolive offers stability and predictable long-term returns.
Building a Recession-Resistant Portfolio
Investing in defensive stocks during recession periods isn’t about chasing explosive growth; it’s about protecting capital and maintaining steady returns. Companies in healthcare, utilities, consumer staples, and discount retail tend to outperform during downturns because their products remain essential. By adding a mix of these recession-proof stocks to your portfolio, you can reduce volatility, earn reliable dividends, and stay invested with confidence even when markets get turbulent.