Recession-Resistant Stocks 2026: 15 Companies Ranked by SEC Filing Data

Last Updated: February 14, 2026

The Ranking: 15 Most Recession-Resistant Operations

These 15 companies were selected from the top 500 US companies by market cap — themselves part of a broader 1,752-company screen. The selection criteria: ROIC above 18%, positive free cash flow, interest coverage above 5x or net cash position, and net debt/EBITDA below 3x. They're ranked by latest ROIC with consistency as a tiebreaker.

Sector breakdown: Only 4 of 15 are in traditional "defensive" sectors (LLY as Healthcare; MO, CL, COST as Consumer Staples). The other 11 span Technology, Financials, Industrials, Business Services, and Energy. This isn't an accident — it mirrors what the full 1,752-company screen found.

Two paths to recession-resistant ROIC: These 15 companies reach high ROIC through distinct mechanisms. Mastercard and Visa earn 58% and 38% ROIC through operating margins above 57% — their asset-light payment networks convert nearly every dollar of revenue to profit. Costco earns 23% ROIC through 3.8% operating margins on $280 billion in revenue — its capital efficiency comes from massive volume on minimal invested assets. Both models produce recession-resistant operations, but for different reasons: margin-driven companies (MA, V, LLY, MO) can absorb revenue declines because their cost base is low, while turnover-driven companies (COST, FIX, ORLY) benefit from volume stability or counter-cyclical demand shifts.

Why These Companies Are Recession-Resistant

Each of these 15 companies has a specific structural mechanism — visible in their SEC filings — that explains why their operations would hold up in a downturn:

• MA, V: Revenue scales with nominal payment volume. Inflation increases spending, so revenue rises even if real spending is flat. Zero credit risk — issuing banks absorb defaults.
• AVGO: Mission-critical infrastructure software (VMware, $18B+ recurring revenue) and semiconductor components designed into customer hardware. 68% gross margin reflects the pricing power of components that cost customers more to replace than to keep buying.
• MO: Addictive product category with inelastic demand. Tobacco consumption barely declined during 2008-2009. Price increases consistently exceed volume declines.
• FIX: Building HVAC and electrical maintenance is non-discretionary — buildings must remain operational. Majority of revenue from non-residential services on multi-year contracts.
• LLY: GLP-1 drugs (Mounjaro, Zepbound) treat chronic conditions — obesity and type 2 diabetes — that patients manage year-round, recession or not. LLY's 83% gross margin reflects patent-protected pricing that doesn't compete on cost. Revenue grew 32% YoY to $45.5B, driven by prescription volume, not discretionary spending.
• ADP, PAYX: Payroll processing is legally required as long as companies have employees. Revenue declines only when employers reduce headcount, not when they cut discretionary spending. Note: PAYX's current ROIC (22.9%) is below its 8-quarter median (33.6%), reflecting recent softness — the structural moat remains, but near-term metrics are deteriorating.
• ORLY: Auto parts become more essential in recessions as consumers repair existing vehicles instead of buying new ones. O'Reilly's revenue increased during both 2008-2009 and 2020.
• COP: Operationally excellent E&P with low leverage and high FCF, but the most cyclical company on this list. Oil-price dependence is real — COP's revenue dropped 35% during the 2020 downturn. It's here because balance-sheet discipline (0.3x ND/EBITDA, 58x ICR) provides a cushion that overleveraged energy companies lack.
• CL: Global distribution across 200+ countries means CL's diversification is geographic, not just product-based. 35.5% ROIC with 15.8x interest coverage and an improving trend (+5.6pp) — the reason CL is here and PepsiCo (13.9% ROIC) isn't comes down to operational efficiency and balance sheet discipline, not just selling toothpaste.
• ITW: ITW's 80/20 operating model — documented in its 10-K — systematically exits low-margin product lines. This produced 26.3% operating margins across 85 decentralized divisions. In a recession, each division adjusts independently to local conditions rather than waiting for corporate direction.
• COST: Membership model with 92.3% renewal rate. Counter-cyclical: consumers trade down to Costco's value proposition during recessions.
• APH: Sole-source connectors embedded in aerospace, defense, and data center infrastructure. APH's 19% FCF margin on 22.4% ROIC shows the business converts most of its profit to cash — a sign that the moat produces real economic value, not just accounting returns.
• HWM: FAA-certified, sole-source aerospace components. Airlines can't switch suppliers without years of re-certification. Defense contracts provide a revenue floor. HWM is included for its structural moat rather than historical consistency — its 8Q median ROIC (8.5%) reflects a recent turnaround from a lower base.

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How We Screened 1,752 Companies

We queried MetricDuck's SEC filing database for every non-OTC US public company with recent filing data. For each company, we pulled six metrics directly from their most recent SEC filings:

Metric	What It Measures	Why It Matters in a Recession
ROIC	Return on invested capital	Companies generating high returns need less external capital to survive
FCF Margin	Free cash flow / revenue	Cash generation funds operations when credit markets tighten
Interest Coverage	EBIT / interest expense	Ability to service debt if earnings decline
Net Debt/EBITDA	Leverage relative to earnings	How many years of earnings to repay all debt
ROIC 8Q Median	Consistency over 2 years	Separates structural quality from one-quarter spikes
ROIC Trend	8-quarter directional slope	Improving vs. deteriorating operations

Coverage: 1,752 companies had ROIC data. 1,122 had complete data across ROIC, free cash flow, and interest coverage. 318 were in the top 500 by market cap.

The key insight from the data: operational quality varies far more within sectors than between them. Consumer Staples ROIC ranges from -7.0% to 66.1% — a 73 percentage point spread. The gap between defensive and cyclical sector medians is just 5 points. Within-sector variance is 14x the between-sector gap.

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The Defensive Sector Myth

The standard recession playbook says rotate into "defensive" sectors — Consumer Staples, Healthcare, Utilities. Our 1,752-company screen tested that assumption directly.

Important caveat: This table compares current-period metrics, not through-cycle performance. Defensive sectors are valued precisely because their metrics decline less in downturns — stability, not level. The counterargument to this table is that cyclical sectors' higher ROIC may partially reflect favorable macro conditions. We address this gap in our limitations section.

Cyclical sectors outscore defensive sectors on every metric — 43% higher ROIC, higher FCF margins, 43% more interest coverage. The reason isn't that "cyclical" companies are inherently better. It's that sectors like Technology and Financials contain more asset-light business models (payment networks, software, services) that naturally produce high ROIC without heavy capital investment. "Defensive" sectors like Utilities are structurally capital-intensive — a power plant requires billions in upfront investment, compressing ROIC regardless of demand stability. And 51% of cyclical companies in the top 500 passed our recession criteria versus 34% of defensive companies.

Utilities: The Biggest Myth

Utilities are marketed as the ultimate recession hedge. The data tells a different story:

• Median ROIC: 9.0% — second-lowest of any sector
• Median net debt/EBITDA: 4.4x — the most leveraged sector in the market
• Median interest coverage: 2.6x — a company with 2.6x coverage loses interest-coverage headroom after roughly a 60% earnings decline

Southern Company (SO) illustrates the distortion. Its 171% ROIC is a capital-structure artifact — decades of regulated-utility accounting produce a thin equity base that inflates ROIC. But its interest coverage is just 2.4x, and net debt/EBITDA is 4.6x. In a rate-driven recession where borrowing costs rise, utilities with 4-5x leverage are among the most vulnerable companies in the market.

Consumer Staples: Huge Variance

Even within Consumer Staples — the "safest" sector — the range is enormous:

Company	ROIC	FCF Margin	ICR	Signal
Procter & Gamble (PG)	66.1%	17.6%	23.7x	Brand portfolio, pricing power
Altria (MO)	43.0%	39.3%	—	Inelastic demand, pricing power
Colgate-Palmolive (CL)	35.5%	17.1%	15.8x	Essential products, global reach
Costco (COST)	23.4%	3.2%	70.1x	Membership model, net cash
PepsiCo (PEP)	13.9%	8.2%	10.3x	Volume-dependent, discretionary snacks
Kraft Heinz (KHC)	-7.0%	14.7%	—	Goodwill-heavy, negative returns
Estee Lauder (EL)	-4.3%	7.7%	1.4x	Demand-dependent, thin coverage

Procter & Gamble's ROIC is 73 percentage points higher than Kraft Heinz's. Both are Consumer Staples. KHC and EL now have negative ROIC — they're destroying capital, not generating it. The sector label tells you nothing about which companies survive a recession. The filing metrics do.

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What Sets These Companies Apart

The 15 companies in our ranking share structural features visible in their SEC filings. Three examples illustrate the pattern.

Pricing Power: Howmet Aerospace (HWM)

Howmet manufactures sole-source, FAA-certified aerospace components. Airlines can't switch suppliers without years of re-certification — a structural moat that shows up directly in the filing language.

"Product price increases are in excess of material and inflationary cost pass through to our customers."

That single sentence explains how a company classified as "Industrials" — a sector most investors avoid in a recession — reached 18.0% ROIC while expanding margins. COGS as a percentage of sales fell from 68.9% to 65.8%. Cash from operations grew 45% to $1.88 billion. Net debt/EBITDA improved to 1.1x. The sector says "cyclical." The filing says "pricing power exceeds inflation."

Structural Resilience: Visa (V)

Visa's filing contains a line that explains why a payment network belongs in a recession-resistance ranking:

"Visa is not a financial institution. We do not issue cards, extend credit or set rates and fees for account holders of Visa products nor do we earn revenue from or bear credit risk with respect to any of these activities."

Visa bears zero credit risk. When consumers default, issuing banks absorb the loss — Visa already collected its fee at transaction time. Revenue scales with nominal payment volume: when inflation rises, nominal spending rises, and Visa's revenue rises even if real spending is flat. This is why a company classified as "Financials" has 37.8% ROIC, 55.4% FCF margin, and near-zero leverage.

Mastercard (MA) operates the same model at 58.1% ROIC and 52.3% FCF margin. Together, they demonstrate that sector classification ("Financials") hides the actual business model (toll-road on global commerce).

Revenue Stability: Costco (COST)

Costco's 23.4% ROIC and 3.2% FCF margin look modest next to other companies on this list. But its filing reveals why membership-based retail belongs in a recession-resistant ranking:

"Our member renewal rate was 92.3% in the U.S. and Canada and 89.8% worldwide at the end of 2025."

A 92.3% renewal rate means Costco's revenue base is largely locked in before each fiscal year begins. Membership fees ($5.3 billion, up 10% year-over-year) are a sunk cost that concentrates member spending at Costco. Revenue growth was driven by 5% shopping frequency growth — traffic-driven, not price-driven. The business model is counter-cyclical: during the 2008-2009 recession, Costco's comparable sales still grew 7.5% while many retailers contracted. In a downturn, consumers trade down to Costco's value proposition.

Costco also carries net cash on its balance sheet and has 70.1x interest coverage. The low FCF margin multiplied by $280 billion in revenue still produces more free cash flow ($9 billion) than most high-margin companies.

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What This Ranking Can't Tell You

These are operational metrics, not stock recommendations. A company with strong recession-resistant operations can still be overvalued, and stock performance depends on price paid relative to quality owned.

ROIC can be inflated by capital structure. Companies with decades of buybacks (like Procter & Gamble at 66.1% ROIC) show inflated returns due to a thin equity base. Asset-based ROIC provides a cross-check — PG's is 21.4%, still strong but less extreme.

Revenue cyclicality is real. These metrics measure operational quality today — not how far revenue falls in a downturn. Howmet's ROIC is strong, but commercial aviation revenue declined 54% during COVID. ConocoPhillips depends on oil prices. Even companies with strong operational metrics will experience revenue declines in their cyclical end markets — the difference is they generate enough cash and maintain low enough leverage to survive and recover.

We don't have a full recession backtest. Our filing data covers 2019-2025. COVID is our only economic shock in this window, and it was atypical (government stimulus, essential-business designations, work-from-home dynamics). External research connecting high ROIC to recession survival in 2008 supports this framework, but it's not our data.

The honest framing: these five metrics identify companies whose operations generate enough returns, cash, and balance sheet cushion to self-fund through adversity. That's the difference between a temporary stock price decline and a structural business crisis.

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How to Check These Metrics Yourself

Every metric in this ranking is calculated directly from SEC filings. MetricDuck shows them for thousands of public companies:

• Mastercard ROIC — 58.1% ROIC, 56.6% 8-quarter median
• Visa ROIC — 37.8% ROIC, toll-road economics, zero credit risk
• Eli Lilly ROIC — 40.2% ROIC, GLP-1 driven growth
• Broadcom Analysis — 46.7% ROIC, 42% FCF margin
• ConocoPhillips ROIC — 38.7% ROIC, disciplined E&P
• Illinois Tool Works ROIC — 33.3% ROIC, 80/20 operating model
• Howmet Aerospace ROIC — 18.0% ROIC, sole-source pricing power
• Costco Analysis — 23.4% ROIC, 70x interest coverage, net cash

Our ROIC stock screening framework explains how to use these metrics systematically across 938+ companies.

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Further Reading

• ROIC Stock Screening: Sector Benchmarks — 938-company analysis showing within-sector ROIC variance
• Cash Flow Quality Analysis Framework — OCF/NI ratio and FCF consistency methodology
• Consumer Staples ROIC: PG, KO, CL, PEP — Why "defensive" staples range from 13.9% to 66.1% ROIC
• Retail ROIC: Costco vs. Walmart — How 3% margins produce 23% ROIC through asset turnover
• Howmet Aerospace: Sole-Source ROIC — FAA certification moat and pricing power analysis
• Payment Network ROIC: Visa and Mastercard — Toll-road economics and 59% operating margins
• Amphenol: 52% Growth and ROIC — CCC improvement during explosive growth