- The current market meltdown has many investors seeking refuge in stocks that offer stability and resilience.
- Two such companies that stand out are Elevance Health and Kraft Heinz.
- Both companies operate in sectors that tend to be resilient during downturns, making them attractive options to help protect your portfolio.
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In the wake of the S&P 500's dramatic 4% plunge on Thursday, which erased approximately $2 trillion in market value following President Donald Trump's new tariff announcements, investors are understandably seeking shelter from the storm.
Among the companies that stand out for their defensive qualities are Elevance Health (NYSE:ELV) and Kraft Heinz (NASDAQ:KHC). Each operates in a sector known for its stability, and their business models offer unique advantages in uncertain times.
Let's explore what these companies do, the services they provide, and why they are considered safe stocks amid the market chaos.
1. Elevance Health
- Year-To-Date Performance: +22.7%
- Fair Value Upside: +18.9%
- Market Cap: $102.9 Billion
Elevance Health, formerly known as Anthem, is one of the nation's leading health benefits companies, serving more than 40 million Americans through its family of health plans. The company offers a comprehensive array of health insurance products and services, including medical, pharmaceutical, dental, behavioral health, and vision care insurance.
ELV is currently at $452.69, earning the Indianapolis, Indiana-based company a market value of $102.9 billion. Shares are up by roughly 23% so far in 2025.
Source: Investing.com
What makes Elevance Health particularly "safe" during market meltdowns is its defensive nature and recession-resistant business model. Healthcare spending tends to remain relatively stable even during economic downturns, as people continue to need medical services.
Additionally, Elevance benefits from long-term contracts with employers and government programs like Medicare and Medicaid, providing predictable revenue streams. The company's diversified business lines across commercial and government segments further insulate it from sector-specific disruptions.
The company stands out with a ‘GREAT’ Financial Health Score of 3.17 and strong profitability metrics, making it an excellent hedge against market turbulence. It is worth mentioning that shares are currently trading below both their Fair Value estimate ($529.26) and the mean analyst target price ($498.18).
Source: InvestingPro
Key Takeaway: With its consistent revenue streams and strong track record of returning capital to shareholders through dividends, Elevance Health is a solid defensive stock to own as markets digest the potential impact of new tariffs and economic headwinds.
2. Kraft Heinz
- Year-To-Date Performance: +0.3%
- Fair Value Upside: +17.2%
- Market Cap: $36.8 Billion
Kraft Heinz is a global food and beverage company with a portfolio of iconic brands, including Kraft, Heinz, Oscar Mayer, and more. The company provides a wide range of products, from condiments and sauces to dairy and snacks, catering to consumer needs around the world.
KHC stock is currently trading at $30.81, earning the Pittsburgh, Pennsylvania-based food and beverage giant a valuation of $36.8 billion. Shares are roughly flat since the start of 2025.
Source: Investing.com
Kraft Heinz exemplifies safety during market turmoil through its consumer staples positioning. People continue to eat regardless of economic conditions, and the company's portfolio of established, affordable brands often sees stable demand even when consumers tighten their belts.
Additionally, the food company has a solid history of dividend payments and growth, making it an attractive income-generating asset when investor sentiment is low. It currently offers an annual payout of $1.60 at an attractive yield of 5.19%.
With an InvestingPro Financial Health Score of 2.72, Kraft Heinz maintains reasonable financial stability, and analysts project a Fair Value upside of roughly 17% from current levels.
Source: InvestingPro
Key Takeaway: Kraft Heinz benefits from the defensive nature of the consumer staples sector, as people tend to maintain their consumption of essential food items even during economic downturns. The company's diversified product portfolio and strong brand recognition contribute to its stability and resilience amid market volatility.
Conclusion
In conclusion, Elevance Health and Kraft Heinz represent safe harbors for investors seeking stability during times of market turbulence. Their defensive characteristics, strong market positions, and strategic focus on growth and efficiency provide a solid foundation for weathering economic storms.
As always, investors should conduct their own research and consider their investment goals and risk tolerance before making any investment decisions.
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Disclosure: At the time of writing, I am short on the S&P 500 and Nasdaq 100 via the ProShares Short S&P 500 ETF (SH) and ProShares Short QQQ ETF (PSQ).
I regularly rebalance my portfolio of individual stocks and ETFs based on ongoing risk assessment of both the macroeconomic environment and companies' financials.
The views discussed in this article are solely the opinion of the author and should not be taken as investment advice.
Follow Jesse Cohen on X/Twitter @JesseCohenInv for more stock market analysis and insight.