In this article, we will list the 5 best defensive stocks to invest in now. Please visit 14 Best Defensive Stocks to Invest In Now if you would like to see the extended list and the methodology behind it.
Stocks
5. Bristol-Myers Squibb Company (NYSE:BMY)
Bristol-Myers Squibb Company (NYSE:BMY) remains a favorite for conservative portfolios due to its exceptionally low volatility and its status as a high-yield income fortress. In a year marked by geopolitical tension and oil-driven market swings, the stock has served as a critical shock absorber for investors. It currently boasts one of the lowest betas in the S&P 500. This means it is roughly 73% less volatile than the broader market. As a major provider of life-saving oncology, cardiovascular, and immunology drugs, demand for the products marketed by the firm is decoupled from economic cycles. For example, patients do not stop taking medicines like Eliquis or Opdivo during a recession.
Bristol-Myers Squibb Company (NYSE:BMY) is a top pick for income-focused funds because of its generous and reliable payout. Following the quarterly dividend of $0.63 per share paid in early 2026, the stock offers a significantly higher yield than many of its big-pharma peers. Despite recent earnings headwinds, the firm maintains a healthy cash payout ratio of approximately 35%. This provides a massive buffer to continue raising dividends while still funding the $9 billion+ annual R&D budget required to refresh its pipeline. The company is successfully transitioning to a new product portfolio. It is currently replacing revenue from legacy drugs with new launches like Camzyos, for heart disease, Sotyktu, for psoriasis, and Cobenfy, for neuropsychiatry. These growth products saw a 10% increase in the most recent quarter, de-risking the company’s long-term revenue outlook.
4. Gilead Sciences, Inc. (NASDAQ:GILD)
Gilead Sciences, Inc. (NASDAQ:GILD) has transitioned away from its volatile COVID-19 treatment revenue from Veklury. The core business in HIV and a growing oncology pipeline provide the firm with high-visibility, non-discretionary earnings. The defensive strength is the dominant position in the HIV market, which functions similarly to a utility because the treatments are life-sustaining and non-discretionary. Gilead’s HIV portfolio generated $20.8 billion in 2025. Patients rarely switch treatments once stabilized, creating a highly predictable cash flow that is unaffected by broader economic cycles. During the Barclays Healthcare Conference in March, CFO Andrew Dickinson emphasized that Gilead faces no major loss of exclusivity until 2036. This runway provides a level of safety that is rare in the pharma sector. Yeztugo, the first twice-yearly HIV prevention therapy, is expected to hit $800 million in sales in 2026.
READ MORE: 10 Best Stocks to Buy According to Billionaire Paul Tudor Jones.
Gilead Sciences, Inc. (NASDAQ:GILD) stock is a favorite for income-focused funds because of its aggressive cash return to shareholders. In February, the board raised the quarterly dividend to $0.82 per share, marking another year of consecutive growth. As of April, the forward dividend yield stands at approximately 2.4%, backed by a healthy non-GAAP EPS guidance of $8.45–$8.85 for the full year. To bolster its defensive profile, Gilead has spent the last five years diversifying into oncology, which now accounts for about 12% of total revenue. Products like Trodelvy and cell therapies are seeing double-digit growth. This provides a growth kicker on top of the defensive HIV base, diversifying the company’s risk across different therapeutic areas.
3. Lowe’s Companies, Inc. (NYSE:LOW)
Lowe’s Companies, Inc. (NYSE:LOW) is viewed as a top defensive stock, particularly in the housing-adjacent retail space. While it shares many similarities with Home Depot, Lowe’s is often considered more defensive due to its heavy focus on the DIY segment and its superior dividend track record. The business model has a built-in buffer that activates when the economy cools. Roughly 70% of Lowe’s sales come from DIY customers. When interest rates are high and home sales slow, as seen in early 2026, consumers focus on repairing and maintaining their current homes rather than buying new ones. This non-discretionary maintenance provides a stable revenue floor that more contractor-heavy peers lack.
For defensive investors, Lowe’s Companies, Inc. (NYSE:LOW) is an elite income-generating machine. The company has increased its dividend for 63 consecutive years. The stock is trading ex-dividend with a quarterly payout of $1.20 per share. While many defensive stocks offer slow dividend growth, Lowe’s has maintained a 3-year average dividend growth rate of over 13%. Its current yield of approximately 2.0% is supported by a share buyback program that has reduced its share count by 25% over the last five years. While it remains DIY-heavy, Lowe’s has successfully grown its Pro segment from 20% to 30% of sales. This provides a more predictable, high-volume revenue stream from professional tradespeople who have multi-year project backlogs.
2. AT&T Inc. (NYSE:T)
Following its massive restructuring to shed media assets like WarnerMedia, AT&T Inc. (NYSE:T) has returned to its roots as a pure-play telecommunications giant, characterized by predictable cash flows and high barriers to entry. The primary defensive thesis for the firm is that wireless and fiber internet have moved from discretionary to essential services. Even during inflationary spikes or economic downturns, consumers are unlikely to cancel their primary phone line or home internet. This provides AT&T with a stable revenue floor that is largely decoupled from the broader business cycle. In early 2026, AT&T reported historically low postpaid phone churn, indicating high customer loyalty even as competitors like T-Mobile shifted pricing strategies.
READ MORE: 15 Best Stocks to Buy According to Billionaire Ray Dalio.
For defensive investors, the new AT&T Inc. (NYSE:T) is prized for its ability to generate significant cash after capital expenditures. The company recently reaffirmed its 2026 free cash flow guidance of $17 billion–$18 billion. This liquidity allows the company to simultaneously pay down its debt and fund its generous dividend. The stock offers a dividend yield of approximately 6.0%–6.2%. Following the dividend right-sizing post-spinoff, the payout ratio is now at a very sustainable 40% of FCF, making it one of the safest high-yield options in the S&P 500. The company’s financial profile has significantly improved in recent months. AT&T has successfully moved toward its target net debt-to-adjusted EBITDA ratio of 2.5x.
1. The Home Depot, Inc. (NYSE:HD)
The Home Depot, Inc. (NYSE:HD) is considered a core defensive stock due to its massive scale, irreplaceable physical footprint, and its essential role in maintaining the aging US housing market. While the stock has faced some headwinds from high mortgage rates, it remains a favorite for low-volatility portfolios. The stock is often treated as a proxy for the housing market, but its defensive strength lies in the fact that it supports the maintenance of existing homes, which is a non-discretionary expense. As of 2026, the average age of a home in the US is over 40 years. Whether the economy is strong or weak, homeowners must spend on essential repairs like plumbing, roofing, and electrical maintenance. During economic slowdowns, while big-ticket remodels might decline, smaller maintenance projects often increase as homeowners focus on preserving their most valuable asset.
The defensive profile of The Home Depot, Inc. (NYSE:HD) is significantly bolstered by its dominance in the professional contractor segment. Through its $18 billion acquisition of SRS Distribution, finalized in late 2024, and recent tech investments in 2026, Home Depot has solidified its moat with professional tradespeople. Professionals have higher spending power and more consistent project backlogs than DIYers. This sticky relationship creates a steady stream of high-volume revenue that acts as a buffer when consumer confidence dips. The firm is also a dividend machine that has paid out for 156 consecutive quarters. In February, the board approved a 1.3% increase in the quarterly dividend to $2.33 per share. The stock yields approximately 2.7%–2.8%.
While we acknowledge the potential of HD to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than HD and that has 100x upside potential, check out our report about the cheapest AI stock.
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