Recession Proof US Shares worth researching. The definition of recession proof Shares is an individual choice. As I primarily invest in Dividend Growth Shares my definition is influenced by these requirements.

I have researched the US market, screening for shares that meet the following criteria:

Low probability that the dividend is at risk

Paid dividends for more than 20 years

Average annual dividend growth is more than 5% for the last 20 years

Growing Dividends (more than 5% last year)

Dividend Yield between 2.0% to 7.5%

Must have generated free cash flow 7 out of the last 10 years

Increased or at least maintained its dividend through the last financial crisis between 2007-09

Current dividend is above its 5-year average yield (could indicate the share is undervalued)

Dividend Pay Out Ratio is less than 75% (Indicating the company is retaining sufficient capital for re-investment)

Average return during the 2007-09 recession was equal to or higher than the S&P 500

After applying this screener, I was left with 38 companies that met my criteria.

I will Further research some of these companies and write about them in the coming weeks.

The following are stocks that I have written about this year and therefore will not discuss them in future articles as part of this series.

Ticker

Name

% Above 5-Year Average Dividend Yield

Dividend Yield

1 Year Dividend Growth

Uninterrupted Dividend Streak (Years)

Recession Dividend

Recession Return %

Annual ROR forecast next 2 years

JNJ

Johnson & Johnson

-5.00%

2.60%

5.40%

26

Increased

-27%

8.00%

SJM

J. M. Smucker Company

38.00%

3.30%

11.90%

25

Increased

-27%

24.00%

KMB

Kimberly-Clark Corporation

22.00%

3.80%

5.40%

24

Increased

-34%

18.00%

CVS

CVS Health Corporation

57.00%

2.80%

17.60%

21

Increased

-38%

33.00%

O

Realty Income Corporation

-1.00%

4.60%

5.60%

21

Increased

-43%

9.50%

MMM

3M Company

8.00%

2.80%

6.00%

26

Increased

-54%

14.00%

ITW

Illinois Tool Works

51.00%

3.10%

19.20%

26

Maintained

-55%

22.00%

SNA

Snap-on Incorporated

36.00%

2.20%

16.10%

25

Maintained

-56%

29.00%

During the last Great Recession all these stocks either increased or maintained their dividend. Also, during this time 2007 to 2009 the S&P500 returned -55%. All the stocks discussed in this series would have beaten or at least equalled the S&P500 return. I do believe these shares are worth further research with the view to adding them to a recession proof dividend growth portfolio. Dividend Growth Shares typically maintain or grow their income during market corrections and they have lower volatility than the market.

Disclaimer: Please note that I am not a Registered Financial Planner. The articles I write are based on my own personal research and for my own use and is not to be construed as financial planning advice. At all times readers are urged to exercise caution when investing in any financial instruments, to do their own research

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