Summary
Given the longevity of the current cycle and growing signs that suggest some potential for an economic downturn in the next few years, it's time to look at defensive stocks.
Kimberly-Clark fits the classic profile of such a company with the right product and brand lineup.
The stock should show resilience in face of global economic difficulties, but its dividend, while decent, is not close to being the highest among defensive names.
As I pointed out more than two months ago, I am starting to look at defensive stocks in the face of what is now a very mature global economic recovery, which started all the way back in 2009. It is not so much the case that the length of the recovery dictates that a recession must now be near, but generally speaking, a number of factors tend to come into play which eventually leads to such an outcome sooner or later. In response to my own conclusion on this matter, I decided that it is time to start sifting through typical or less typical defensive stocks with the intent of starting to shift my own portfolio towards such assets, mostly having a longer-term strategy in mind. Thus far, I have covered Kraft Heinz (KHC), Procter & Gamble (PG), Lockheed Martin (LMT), and Cameco (CCJ). Of these names, I already own Cameco stock, which is not a typical defensive stock, but as I pointed out, given the nature of the uranium market, I do expect it to hold up well in the event of a recession. For this article, I want to cover the advantages and disadvantages of Kimberly-Clark (KMB), which is about as typical as it comes in terms of being a defensive stock given its product lineup and dividend offer.
