3 Defensive Picks to Add Stability to Your Portfolio

Economic Outlook - As of January 9, 2025, the New York Fed's model indicates a 29% chance of a U.S. recession in 2025, a significant decrease from 70% two years prior [1] - Investors are expected to approach the new year with caution, seeking recession-proof investments due to uncertainties such as regulatory changes and military activities [2] Defensive Investment Opportunities - Analysts recommend defensive plays in consumer staples and retail, highlighting Procter & Gamble, Colgate-Palmolive, and Costco as strong candidates [3] Procter & Gamble (P&G) - P&G has a dividend yield of 2.53%, an annual dividend of 4.02, and a 69-year history of dividend increases, making it attractive for passive income [3] - P&G shares increased by approximately 9% leading up to January 9, 2025, despite a recent 5% decline, suggesting a potential buying opportunity [4] - Analysts project an 11% upside for P&G based on a consensus price target of 179.75, with its diverse product lineup providing stability during economic downturns [4] Colgate-Palmolive - Colgate-Palmolive offers a dividend yield of 2.32% and has a 62-year history of dividend payments, with an annualized 3-year dividend growth of 3.42% [6] - The stock reached an all-time high of over $105 in August 2024, driven by strong sales and improved operating margins, with analysts expecting 8$1,000 in December 2024, supported by an aggressive expansion plan and a 21% increase in e-commerce sales [9] - Despite a membership fee increase, Costco's member base grew by nearly 8% in the last quarter, indicating strong customer loyalty and a positive outlook for profits in 2025 and 2026 [10]