U.S. internet stocks have been red-hot once again in 2019, gaining roughly 45% year-to-date. Each month, Nomura Instinet analyst Mark Kelley tracks the latest trends in global internet usage by taking a look at Sensor Tower data for the month. In addition, Kelley looks at recent headlines to get a sense of which internet stocks are winning over users. Investors who get ahead of the curve by examining internet usage data can potentially get valuable insight heading into third-quarter earnings season for stocks.
Here are my picks for recession-resistant services stocks to buy:
At first glance, Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) doesn’t appear an intuitive candidate for recession-resistant services stocks to buy. With its technology-centric business, and one that is increasingly geared toward the cloud, GOOGL stock would seem more vulnerable to volatility under a recession.
However, what changes the calculus for GOOGL stock is YouTube. As we all know, recessions are generally unhelpful for discretionary retail names: people simply will shut down unnecessary spending. And in some ways, that applies to services stocks as well. However, Alphabet via YouTube provides a wealth of free information (amid all the other junk).
AutoZone (NYSE:AZO) and AZO stock – You don’t have to do deep research to understand that auto sales decline sharply in a recession. But if you want the proof, here it is: according to the Federal Reserve’s economic research arm, the retail automotive sector was one of the hardest hit segments of the economy during the 2008 financial crisis and the subsequent Great Recession.That’s bad news for automakers. However, it might spell at least a stable revenue channel for AutoZone (NYSE:AZO) and AZO stock.
Part of the allure of buying a new car is the associated benefits. For instance, many dealerships offer complementary services like oil changes for the first few years of ownership (or lease). But in a recession, such offers won’t be enough to overcome consumer fears. That plays into the hands of AZO stock and related services stocks to buy.
Not only does AutoZone provide an extensive array of parts, their customer service team can help direct you accordingly. Combined with the do-it-yourself information available at YouTube, AZO stock appears a compelling contrarian buy in a recession.
Among recession-resistant services stocks to buy, H&R Block (NYSE:HRB) is probably the least intuitive play. That assessment has only been exacerbated by the recent sharp decline in HRB stock. With the drop, shares have essentially gone flat for over the last three years. Certainly, this is not a great way to make an introduction.
I’ll freely admit that HRB stock has substantial risks. If you have a conservative portfolio, you may want to seek other services stocks. That said, if we fall into a recession, H&R Block’s core business becomes all the more valuable.
Yes, you can do your taxes yourself, which saves frontline costs. However, in the long run, you’re better off with credentialed accounting advice. That applies even more so with small business owners and those with complex tax situations.
Indeed, in these latter categories, people can save money in the long haul. With accountants guiding you to perfectly legal deductions, clients can maximize their financials and have peace of mind. Those are all valuable attributes that underline HRB stock.
Disclaimer: We are not a financial institution: All we are proving is educational material: Do not take this information as professional investment advice. Muvison may earn an Affiliate Commission if you purchase something through recommended links in this site. Thank you for your support.