The last time the economy experienced two negative quarters of gross domestic product was the first and second quarters of 2022, with a 1.6% pullback in the first quarter and a 0.6% decline in the second. While the National Bureau of Economic Research (NBER) Business-Cycle Dating Committee declined to dub it as a recession, probably encouraged by the Biden administration at the time, it technically was a mild recession.
The recent ADP and non-farm payroll data for February came in way below estimates, and the Atlanta Federal Reserve’s GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) for the first quarter of 2025 is currently set at −2.8% down from −1.5%. If that number is even half right, we will have the opening data for a 2025 recession.
Specific stock sectors tend to perform better during recessions due to their nature and the consistent demand for goods or services. These sectors are often seen as recession-resistant because they provide products and services that people still need, even when the economy is struggling. Consumer staples, healthcare, utilities, telecommunications, real estate, and gold are among the best sectors to own during recessions.
We screened our 24/7 Wall St. research database looking for companies that typically hold up better during recessions and offer the solid and dependable dividends the group specializes in. Five of our favorite high-yield dividend companies are outstanding ideas for growth and income investors now. All are buy-rated at top Wall Street firms that we cover.
Why do we cover high-yield dividend stocks?
Dividend stocks provide investors with reliable streams of passive income. Passive income is characterized by its ability to generate revenue without requiring the earner’s continuous active effort, making it a desirable financial strategy for those seeking to diversify their income streams or achieve financial independence.
Bristol-Myers Squibb
Bristol Myers Squibb is a global biopharmaceutical company committed to discovering, developing, and delivering innovative medicines.
This top company remains a solid pharmaceutical stock to own long-term, offering an outstanding entry point and a massive 4.15% dividend. Bristol-Myers Squibb Co. (NYSE: BMY | BMY Price Prediction) discovers, develops, licenses, manufactures, and markets pharmaceutical products worldwide.
The company offers products in:
- Hematology
- Oncology
- Cardiovascular
- Immunology therapeutic classes
Bristol-Myers Squibb products include:
- Revlimid, an oral immunomodulatory drug for the treatment of multiple myeloma
- Opdivo for anti-cancer indications
- Eliquis, an oral inhibitor indicated for the reduction in risk of stroke/systemic embolism in NVAF and for the treatment of DVT/PE
- Orencia for adult patients with active RA and psoriatic arthritis, as well as reducing signs and symptoms in pediatric patients with active polyarticular juvenile idiopathic arthritis
The company also provides:
- Sprycel for the treatment of Philadelphia chromosome-positive chronic myeloid leukemia
- Yervoy for the treatment of patients with unresectable or metastatic melanoma
- Abraxane, a protein-bound chemotherapy product
- Implicit for the treatment of multiple myeloma
- Reblozyl for the treatment of anemia in adult patients with beta-thalassemia
Jefferies has a Buy rating with a $70 target price.
Exxon Mobil
Exxon manages an industry-leading portfolio of resources and is one of the world’s largest integrated fuels, lubricants, and chemical companies.
The integrated energy giant still offers investors an excellent entry point, and they will gladly grab a strong 3.76% dividend. Exxon Mobil Corp. (NYSE: XOM) is the world’s largest international integrated oil and gas company, exploring for and producing crude oil and natural gas in:
- The United States
- Canada
- South America
- Europe
- Africa
- Asia
- Australia/Oceania
Exxon also manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics, and specialty products, and transports and sells crude oil, natural gas, and petroleum products.
Top Wall Street analysts expect Exxon to remain a key beneficiary in a stable oil price environment. Most remain very optimistic about the company’s sharp positive inflection in capital allocation strategy, upstream portfolio, and leverage to demand recovery. Exxon also offers greater downstream/chemicals exposure than its peers.
The company has completed its purchase of oil shale giant Pioneer Natural Resources in a $59.5 billion all-stock purchase. The deal created the largest U.S. oilfield producer and guaranteed a decade of low-cost production.
Wells Fargo has an Overweight rating with a $135 target price objective.
Northwest Natural
Northwest Natural provides natural gas service to approximately 2.0 million people in more than 140 communities.
This off-the-radar utility stock suits worried conservative investors and pays a solid 4.70% dividend. Northwest Natural Holding Co. (NYSE: NWN), through its subsidiary, Northwest Natural Gas Company, provides regulated natural gas distribution services to residential, commercial, industrial, and transportation customers in Oregon and Southwest Washington.
The company also operates:
- 5.7 billion cubic feet of the Mist gas storage facility contracted to other utilities and third-party marketers
- Offers natural gas asset management services
- Operates an appliance retail center
In addition, it engages in gas storage, water, non-regulated renewable natural gas, and other investments and activities.
The company provides natural gas service through approximately:
- 786,000 meters in Oregon and southwest Washington
- Water services to about 80,000 people through about 33,000 water and wastewater connections in the Pacific Northwest and Texas
Stifel has a Buy rating with a $44 target price.
Kenvue
Kenvue is the world’s largest pure-play consumer health company in terms of revenue.
Spun off from Johnson & Johnson, Inc. (NYSE: JNJ) in 2023, this potential total return home run pays a solid 3.56% dividend. Kenvue Inc. (NYSE: KVUE) is a global consumer health company.
The company operates through three segments:
- Self Care
- Skin Health and Beauty
- Essential Health
The self-care segment offers cough, cold, and allergy pain care, digestive health, smoking cessation, and other products under the Tylenol, Nicorette, and Zyrtec brands.
The Skin Health and Beauty segment provides face and body care, hair care, sun care, and other products under the Neutrogena, Aveeno, and OGX brand names.
The Essential Health segment offers oral and baby, women’s health, and wound care products under these brands:
- Listerine
- Johnson’s
- Band-Aid
- Stayfree
Canaccord Genuity Group has a Buy rating with a $29 target price.
PepsiCo
As of 2024, Pepsi is the second most valuable soft drink brand worldwide behind Coca-Cola.
This top consumer staples stock posted outstanding earnings for the fourth quarter, will continue to supply all the goods for the upcoming March Madness parties, and pays a solid 3.52% dividend. PepsiCo Inc. (NYSE: PEP) is a worldwide food and beverage company.
Its Frito-Lay North America segment offers:
- Lays and Ruffles potato chips
- Doritos, Tostitos, and Santitas tortilla chips
- Cheetos cheese-flavored snacks, branded dips
- Fritos corn chips
The company’s Quaker Foods North America segment provides:
- Quaker Oatmeal
- Grits
- Rice cakes
- Natural granola and oat squares
- Pearl Milling mixes and syrups
- Quaker Chewy granola bars
- Cap’n Crunch cereal
- Life cereal
- Rice-A-Roni side dishes
PepsiCo’s North America Beverages segment offers beverage concentrates, fountain syrups, and finished goods under these brands:
- Pepsi
- Gatorade
- Mountain Dew
- Diet Pepsi
- Aquafina
- Diet Mountain Dew
- Tropicana Pure Premium
- Sierra Mist
- Mug brands
Barclays has an Overweight rating with a $168 target price.
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