5 Cash-Rich Defensive Stocks to Buy Before Recession

1. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 258

Free Cash Flow as of August 29: $65.15 billion

Microsoft Corporation (NASDAQ:MSFT) is a Washington-based technology firm. The company is expected to be a top defensive pick in the tech sector during a recession due to the strength of enterprise spending, cloud budgets, consumer product demand, and digital advertising. Microsoft Corporation (NASDAQ:MSFT) is also one of the few tech firms that offer a healthy mixture of value and growth to investors. It has paid a dividend to shareholders for close to two decades even as the share price skyrockets. 

On July 27, Wedbush analyst Daniel Ives maintained an Outperform rating on Microsoft Corporation (NASDAQ:MSFT) stock and lowered the price target to $320 from $340, noting that the metrics around cloud and commercial bookings looked strong for the firm.  

Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in Microsoft Corporation (NASDAQ:MSFT), with 28 million shares worth more than $7.3 billion.

In its Q1 2022 investor letter, Carillon Tower Advisers, an investment management firm, highlighted a few stocks and Microsoft Corporation (NASDAQ:MSFT) was one of them. Here is what the fund said:

“Stock selection contributed the most while sector allocation was also positive. An underweight to communication services and an overweight to energy helped performance, while an underweight to consumer staples and an overweight to materials detracted. Stock selection was strong within healthcare and materials but was weak within information technology and industrials. Microsoft Corporation (NASDAQ:MSFT) reported positive results driven by personal computing strength, but analysts were especially positive on its growth outlook for its Azure cloud-computing services.”

You can also take a peek at 10 Penny Stocks Redditors are Buying in August and 10 Best Nickel Stocks to Buy Now.

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