New Real Money Column: Five Stocks for Playing a Recession Safely


I have a new column up at Real Money: Five Stocks for Playing a Recession Safely.  It is a follow up to our prior column "Nine Stocks for Playing the Long Side Safely."

The thinking this time was, even if we have a recession, what sector would be likely to do well? 

"With all of the recession talk lately, my theme
today is screening for potential winners that should hold up regardless
of what happens in the economy, be it a soft landing, reacceleration or
full-blown slowdown.

Kicking around different sector ideas that looked unusually
strong, one of my partners recalled recent CBO congressional testimony
on infrastructure spending. We pulled up the testimony on Public Spending on Surface Transportation Infrastructure
before the Committee on the Budget U.S. House of Representatives. Given
the recent bridge collapse in Minnesota, and the natural tendencies of
congress members to promote public works programs in their districts,
it’s quite likely we will see robust growth in this sector."

The column identifies 5 firms, with entries, targets, and stop losses. (Also,I’ve been hearing rumors on the NYSE that some of these stocks may be getting discussed on CNBC’s Fast Money tonite).

The column is on the subscription only Real Money, but I’ll see if I can get it moved to the free site eventually . . .


Five Stocks for Playing a Recession Safely, 12/3/2007 2:12 PM EST

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What's been said:

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  1. JJL commented on Dec 3

    Maybe it is becasue I was only financially aware during the 2001 recession, but what is all the fear of one? Is a recession all powerful or something? A few quarters of negative growth is not going to kill anyone. The analysts keep saying in their forcasts that housing will be much worse if there is a recession. I think housing is going to get much worse no matter what.

  2. Kevin Flick commented on Dec 3

    Always enjoy your posts…

    Although I don’t have access to Real Money, here is a counter cyclical-play that fits your description.

    Epiq Systems (NASDAQ: EPIQ) provides technology-based products and services for the legal and fiduciary services industries in the United States. Its products and services assist clients with the administration of legal proceedings, including electronic discovery, bankruptcy administration, and class action administration. The company operates in two segments: Case Management and Document Management. The Case Management segment through its integrated technology-based products and services supports client engagements for electronic discovery, class action and mass tort, and bankruptcy proceedings. Its other services are related to the administration of cases, including data conversion, claims processing, claims reconciliation, professional consulting services, and settlement administration. This segment also offers proprietary electronic discovery software that sorts, cleanses, organizes, and performs searches on large volumes of electronic documents in support of a legal proceeding; software for bankruptcy trustee offices that administers Chapter 7 and Chapter 13 bankruptcy cases; and call center support services. The Document Management segment provides legal noticing services to parties of interest in bankruptcy and class action matters, including media campaign and advertising management; and reimbursement for costs related to postage on mailing services. Epiq Systems serves law firms, corporate legal departments, bankruptcy trustees, and other professional advisors. The company, formerly known as Electronic Processing, Inc., was founded in 1988. It changed its name to Epiq Systems, Inc. in 2000. Epiq Systems is headquartered in Kansas City, Kansas.

  3. David commented on Dec 3

    I don’t think we will have a recession, more like a pre-recession Stagflation. I am very optimistic that the vast amount of new credit cards will keep a recession at bay.

  4. Stuart commented on Dec 3

    An anonymous quote that exemplifies the on-going problems… perfectly.

    “And how are rate cuts going to help anything when what the system needs is “more balance sheet,” and there’s none to be found?”

    Headline writers, take notice! That is THE issue… Remember this next time you have an urge to pump up the tempo on the probability of a Fed rate cut.

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