In this article, we will take a look at the 10 Best Bear Market Stocks to Invest In Right Now.
A stock index is considered to be in a bear market when its closing price falls at least 20% from its most recent high. A correction is milder, with losses between 10% and 19.9%. A bull market begins once prices climb 20% from the bottom.
Hartford Funds reported that stocks fall about 35% on average during a bear market. In bull markets, they rise 112% on average. Since 1928, the S&P 500 Index has gone through 27 bear markets. Over the same period, there have been 28 bull markets, and the long-term direction has been upward. Bear markets also tend to move quickly, with an average duration of 289 days, roughly 9.6 months. Bull markets take their time, lasting about 988 days, or close to 2.7 years. The difference is noticeable when viewed over multiple cycles.
The report also points out that bear markets used to come around more often. Between 1928 and 1945, there were 12 of them, or one every 1.5 years. Since 1945, there have been 15, which works out to about one every 5.1 years. Around 42% of the S&P 500 Index’s best days in the last 20 years happened during bear markets. Another 36% came in the first two months of a bull market, before the recovery was obvious. It shows how hard it is to step in and out at the right time. Staying invested often ends up being the steadier approach.
The same report makes another point. A bear market does not always mean a recession is underway. Since 1928, there have been 27 bear markets but only 15 recessions. Markets and the economy often move together, but not always in lockstep. Analysts also note differences across sectors. Defensive areas like consumer staples, healthcare, and utilities tend to hold up better. Technology and financials, on the other hand, usually see more swings.
Given this, we will take a look at some of the best bear market stocks.
Photo by Scott Graham on Unsplash
Our Methodology:
For this article, we screened for companies in the defensive sectors like consumer staples, healthcare, and utilities. Preference was also given to companies with competitive advantages that are attractive relative to their historical or sector averages. We limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These companies are also popular among elite funds and analysts.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 498.7% since May 2014, beating its benchmark by 303 percentage points (see more details here).
10. The Clorox Company (NYSE:CLX)
Number of Hedge Fund Holders: 48
On April 21, Kaumil Gajrawala of Jefferies lowered the firm’s price recommendation on The Clorox Company (NYSE:CLX) to $139 from $151. It reiterated a Buy rating on the shares. He noted that Clorox is heading into a difficult second half. Geopolitical tensions, inflation, and continued share losses are weighing on performance. Category improvement remains limited. He added that Q3 organic growth is likely to come in slightly below expectations. FY26 EPS guidance could also be reduced. The focus, in his view, will be on further estimate cuts and commentary around the longer-term outlook.
On April 17, JPMorgan downgraded CLX to Underweight from Neutral. The firm also cut its price target to $99 from $117 ahead of the fiscal Q3 report scheduled for April 30. The firm expects category growth to stay below historical levels for some time. It pointed to “exogenous factors,” including pressure on lower-income US consumers. It also highlighted Clorox’s exposure to categories where private label competition is strong, particularly in trash bags and surface cleaning. In addition, the firm sees cost pressures from diesel and resins. Based on this, it believes there is downside risk to estimates and expects management to narrow its guidance range.
The Clorox Company (NYSE:CLX) is a multinational manufacturer and marketer of consumer and professional products.
9. The Southern Company (NYSE:SO)
Number of Hedge Fund Holders: 54
On April 21, David Arcaro of Morgan Stanley lowered the firm’s price recommendation on The Southern Company (NYSE:SO) to $92 from $94. It maintained an Underweight rating on the shares. He said the firm is updating price targets for Regulated & Diversified Utilities and IPPs in North America under its coverage. In March, utilities outperformed the S&P 500’s return.
On April 21, Wells Fargo raised its price objective on SO to $99 from $96. It reiterated an Equal Weight rating on the shares. Following conversations with the companies, the firm updated its Q1 2026 estimates to reflect known and measurable drivers across its regulated utility coverage. It also raised its base value multiple times to 17.5 times from 17 times.
The Southern Company (NYSE:SO) is an energy provider. It owns three traditional electric operating companies, Southern Power Company, and Southern Company Gas. The traditional electric operating companies, Alabama Power, Georgia Power, and Mississippi Power, operate as public utilities. They provide electric service to retail customers across three Southeastern states, along with wholesale customers in the Southeast.
8. Dollar General Corporation (NYSE:DG)
Number of Hedge Fund Holders: 57
On April 21, Evercore ISI lowered its price recommendation on Dollar General Corporation (NYSE:DG) to $145 from $150. It reiterated an In Line rating on the stock.
On April 13, Dollar General Corporation shared plans to roll out an upgraded, AI-enabled in-store audio network across roughly 6,000 stores in 48 states. The company is working with QSIC on this effort. The goal is to make in-store audio more relevant and localized, while also making it easier to measure its impact. It also gives brand partners a more data-driven way to advertise across a very large store base.
This rollout will double the company’s current in-store audio presence. It should also improve how performance is tracked at scale. By Q2 2026, around 12,000 stores are expected to have these audio capabilities. Dollar General operates more than 20,000 stores across the United States. About 75% of the US population lives within five miles of one of its locations. That reach stands out, as in many rural areas, these stores are often one of the most convenient options for everyday essentials.
Dollar General Corporation (NYSE:DG) is a discount retailer offering consumables, seasonal goods, home products, and apparel. Its shelves include both national brands and private label items, usually priced below branded alternatives.
7. Abbott Laboratories (NYSE:ABT)
Number of Hedge Fund Holders: 71
On April 22, Daiwa downgraded Abbott Laboratories (NYSE:ABT) to Neutral from Outperform. The firm also lowered its price target on the stock to $92 from $113.
On April 20, Matt Miksic of Barclays lowered the firm’s price recommendation on ABT to $143 from $144. It reiterated an Overweight rating on the shares. He described the company’s Q1 report as mixed, but said there are signs of improvement. The recent pullback in the stock, in his view, creates a buying opportunity, as noted in a research report.
During the company’s earnings call for Q1 2026, Philip Boudreau, CFO & Executive VP of Finance, provided guidance for the second quarter, indicating that adjusted EPS was expected to range between $1.25 and $1.31. Chairman, President & CEO, Robert Ford, explained that the company had chosen not to factor in a potential late-year rebound in respiratory testing, as management did not view it as a prudent assumption for the forecast. He added that if the flu season turned out to be as strong as in prior years, the company had the manufacturing capacity to respond.
He also reiterated management’s expectation that growth would accelerate in the second half of the year, supported by pricing actions in the Nutrition segment, new electrophysiology product launches, and continued momentum in the Core Lab business.
Abbott Laboratories (NYSE:ABT) is a global healthcare company focused on the discovery, development, manufacture, and sale of a broad range of healthcare products. Its segments include Established Pharmaceutical Products, Diagnostic Products, Nutritional Products, and Medical Devices.
6. NextEra Energy, Inc. (NYSE:NEE)
Number of Hedge Fund Holders: 72
On April 21, David Arcaro of Morgan Stanley lowered the firm’s price recommendation on NextEra Energy, Inc. (NYSE:NEE) to $107 from $108. It reiterated an Overweight rating on the shares. He said the firm is updating price targets for Regulated & Diversified Utilities and IPPs in North America under its coverage. In March, utilities outperformed the S&P 500’s return.
On April 21, Shahriar Pourreza of Wells Fargo raised the firm’s price objective on NEE to $99 from $98. It maintained an Overweight rating on the shares. After discussions with the companies, the firm updated its Q1 2026 estimates to reflect known and measurable drivers across its regulated utility coverage. It also raised its base value multiple times to 17.5 times from 17 times.
NextEra Energy, Inc. (NYSE:NEE) is an electric power and energy infrastructure company. It operates through its wholly owned subsidiaries, NextEra Energy Resources, LLC, and NextEra Energy Transmission, LLC, together referred to as NEER, as well as Florida Power & Light Company.
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