Don’t fear the recession. I’d buy these defensive stocks to come out on top

first_img I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement. Renowned stock-picker Mark Rogers and his analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we’re offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our ‘no quibbles’ 30-day subscription fee refund guarantee. Paul Summers | Thursday, 21st May, 2020 | More on: BEG FRP The stock market may have rebounded strongly from March’s coronavirus-related crash, but finding anyone bullish on the UK economy right now is quite a task. Even chancellor Rishi Sunak now believes a significant recession is likely.Is there any way for Foolish investors to come out on top? I think so. Today, I’m taking a closer look at two companies that could offer great protection from the looming fallout.5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…And if you click here we’ll show you something that could be key to unlocking 5G’s full potential…Recession-proofSmall-cap Begbies Traynor (LSE: BEG) is a company I’ve been positive on for quite some time. The £140m-cap is a property services consultant and insolvency specialist — the latter a service that, sadly, looks likely to experience greater demand as the recession hits. Indeed, today’s trading update was indicative of what’s likely to come.Revenue for the financial year to the end of April is now expected to be around £70m — up from just over £60m in 2018/19.Profits at its business recovery and financial advisory division were a highlight. They grew roughly 30% over the year as more firms faced insolvency, even before the pandemic struck. Recent acquisitions and higher average fee levels also provided a boost.All told, adjusted pre-tax profit is likely to come in at £9.2m, up from £7m in 2019. The firm did say, however, this included a £600,000 hit after several of its property service lines were hit by the lockdown. Positive outlookBegbies was trading 3% lower this morning, suggesting some traders were banking profits. The stock was, after all, up a stonking 77% since 23 March.Today’s move aside, I still think the company could be a rare winner in the recession. While the full impact of the coronavirus is unknown, Begbies is expecting “progressive increases in the number of insolvencies” as we move through 2020. This could be compounded, of course, by Brexit.In addition to this ‘positive’ outlook, Begbies finances look increasingly sound. Net debt stood at £2.8m at the end of April, down significantly from £6m in 2019. The firm had £7.2m in cash last month and undrawn borrowing facilities of £15m.There’s good news for income seekers too. Having already paid its interim dividend this month, Begbies said it was intending to confirm a final dividend in July. Trading on 16 times forecast earnings before markets opened, the stock isn’t screamingly cheap. It could, however, be a great counter-cyclical, recession-beating pick.Profits “ahead of expectations”Begbies isn’t the only option for investors in this space. New-stock-on-the-block FRP Advisory (LSE: FRP) could be a great alternative. Larger than its peer Begbies, the company also supports businesses facing insolvency. Unsurprisingly, demand for its services has been just as good. In its recent update, FRP said it had “traded strongly” in the second half of its financial year. Revenue will likely to come in at £31.8m with profits “ahead of the Board’s expectations.” For the full 12 months, £63.2m of revenue has been predicted — a rise of 16.4% on the previous 12 months. Like Begbies, FRP looks financially sound (and you would hope so!). Like Begbies, the company also expects to pay a final dividend. Having only listed in March, the minnow looks to be flying under analyst radars. I expect this to change markedly in the coming months as the recession takes hold. I think those buying this defensive stock now could see great returns in time. Image source: Getty Images Our 6 ‘Best Buys Now’ Shares Simply click below to discover how you can take advantage of this. Paul Summers has no position in any of the shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.center_img Enter Your Email Address Don’t fear the recession. I’d buy these defensive stocks to come out on top Click here to claim your copy now — and we’ll tell you the name of this Top US Share… free of charge! I’m sure you’ll agree that’s quite the statement from Motley Fool Co-Founder Tom Gardner.But since our US analyst team first recommended shares in this unique tech stock back in 2016, the value has soared.What’s more, we firmly believe there’s still plenty of upside in its future. In fact, even throughout the current coronavirus crisis, its performance has been beating Wall St expectations.And right now, we’re giving you a chance to discover exactly what has got our analysts all fired up about this niche industry phenomenon, in our FREE special report, A Top US Share From The Motley Fool. “This Stock Could Be Like Buying Amazon in 1997” See all posts by Paul Summerslast_img

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