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Recession stars: The best stocks in every industry during economic downturns

As Wall Street trots out stock picks to weather downturns, CNBC Pro reviewed past recessions to find the best performers in each industry. More analysts this week are updating their ratings for the likelihood of a recession. On Wednesday, Bank of America upgraded shares of Goldman Sachs to buy from neutral, saying the bank can thrive during a downturn. UBS reviewed how online retailers would perform in a slowdown, downgrading shares of Ebay to neutral as discretionary purchases make up the bulk of its merchandise. Investors are preparing their portfolios as calls for a recession rise on Wall Street. During an appearance Tuesday on CNBC’s ” Squawk Box ,” Ark Invest CEO Cathie Wood said the U.S. is already in a downturn . Wood, whose flagship tech-heavy fund has been devastated this year due to rising interest rates, said she underestimated the severity of inflation. To find winners in a declining economy, CNBC Pro reviewed the stock performance of S & P 500 companies during the past three recessions and in 2022 to pick out the top performers in each industry. Stocks that lost more than 20% during these periods were filtered out. This screen used FactSet data. Here are the recession stars in every industry: Historically speaking, AutoZone is the best performing stock in the retail sector during prior downturns, rallying 41.6% on average during the last three downturns and year to date. The company’s focus on non-discretionary items — or auto parts that drivers need for repairs and replacements regardless of what the economy is doing — earned the stock a buy rating just this week from Goldman Sachs. Gilead Sciences is the recession outperformer in the health-care sector, posting an average gain of 32.9%. The company is diversifying from its HIV business into oncology, which it hopes will generate long-term growth for the company, according to a note last month from SVB Securities. Still, the firm gave Gilead a market perform rating, saying the company will need to generate more compelling products in its pipeline. NortonLifeLock made hefty gains during prior downturns, climbing 12.4% on average. The tech company could become the “dominant player” in consumer cybersecurity after it acquires Avast, according to a note last month from Argus Research. The firm is getting a boost from the rise of remote work and the increasing need for cybersecurity solutions. Other stocks in this list include the following: WestRock , Dollar Tree , Global Payments , W.W. Grainger and Consolidated Edison .

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