2 Recession-Proof Stocks to Buy With a Better Credit Rating Than the U.S. Government

Group 1: U.S. Credit Ratings - In 2011, S&P Global Ratings downgraded the U.S. long-term credit outlook from AAA to AA+ due to budgetary issues, with Fitch downgrading U.S. credit again in 2023 and Moody's considering a similar move [1] - The 2024 fiscal deficit has ballooned to over 1.8 trillion, exacerbating debt and fiscal issues [1] Group 2: Microsoft - Microsoft holds AAA and Aaa ratings from S&P and Moody's, respectively, and has seen its stock fall about 12% this year, outperforming peers in the "Magnificent Seven" [4][6] - The company has a diverse business model across various tech sectors, including cloud, video games, and AI, and was an early investor in OpenAI [4] - Microsoft has a strong balance sheet with over 71.5 billion in cash and equivalents, approximately $40 billion in long-term debt, and equity exceeding$302 billion, resulting in a low debt-to-equity ratio [6] Group 3: Johnson & Johnson - Johnson & Johnson is the only other U.S. company with top credit ratings and recently announced an acquisition of Intra-Cellular Therapies for $14.6 billion, which may impact its credit rating due to increased debt [7] - The stock has performed well, up nearly 9$91.4 billion from 89.4 billion [8] - Johnson & Johnson's CFO indicated that the guidance includes a 400 million impact from tariffs, which could affect stock performance if trade tensions with China persist [9] - At the end of 2024, Johnson & Johnson had over $24 billion in cash, about$30.6 billion in long-term debt, and over $71 billion in total equity, maintaining a strong balance sheet despite the recent acquisition [10]