On June 8, 2020, the National Bureau of Economic Research determined that the United States economy entered a recession in February 2020. This poses a unique risk for investors, because a weak economy means lower consumer spending and fewer profits for companies to return to their shareholders in the form of dividends and capital appreciation.

The good news is that some companies can thrive in this uncertain environment because of their consumer staple business models. Here are three such companies to buy right now.

The first pick is Dollar Tree (NASDAQ:DLTR), a discount variety store operator that serves lower-income customers. Next up is Altria (NYSE:MO), a cigarette manufacturer with resilient sales because of the habit-forming nature of its products. And finally, we have Hormel Foods (NYSE:HRL), a meat processor that can survive in good and bad times because, well, people need to eat.

All three stocks have the potential to beat the market during the recession.

Hundred dollar bill with Ben Franklin wearing a mask

Image source: Getty Images.

1. Dollar Tree

Dollar Tree is a discount variety store chain that operates in the U.S. The company offers a wide range of everyday items targeting budget-conscious consumers, and the is often hailed as recession-proof because people tend to stock up on cheap, staple goods during tough economic times.

So far this year, Dollar Tree stock has slightly underperformed the market average, with shares down around 4% compared to the S&P 500's decline of 2%. However, the company looks poised to outperform the market over the long term as American consumers feel pressure on their wallets due to high unemployment and the rollback of government stimulus programs.

The June unemployment rate stands at 11.1%, and the government's extra $600 CARES Act unemployment benefit is set to end in July, which could further lower people's spending power and boost demand for discount goods.

Dollar Tree reported first-quarter earnings on May 28, and the results show strength in these challenging economic times. Net sales increased by 8.2% to $6.29 billion. This was due, in part, to a boost in demand for essential household products amid the coronavirus pandemic.

2. Altria

Altria is a cigarette manufacturer known for its flagship Marlboro brand. The company is recession-proof because of tobacco's addictive property -- which often means people continue buying it during difficult economic times.

Altria's stock price has been under pressure in recent months, falling 20% year to date after an ill-advised strategic investment in JUUL Labs, a vaping company that's now in hot water over deceptive marketing to teenagers. The good news is that Altria has dramatically reduced its JUUL exposure by writing down its $12.8 billion investment in the company by $8.6 billion in fiscal 2019.

In the first quarter, Altria has exploited its pricing power to boost revenue in the face of a secular decline in U.S tobacco sales volume. Net revenue grew by 13% to $6.36 billion, despite an estimated 5% decline in first-quarter smokable segment volumes. This decline reduces to 3.5% when pantry loading is factored in -- because consumers stocked up on tobacco products during the pandemic.

The stock offers a jaw-dropping dividend yield of 8.41% and has grown its payout for 50 years in a row, making it a reliable investment in these uncertain economic times. 

3. Hormel

Recession or not, people have to eat. And that's what makes Hormel Foods a top recession-proof stock to buy right now. The company manufactures and markets branded food products around the world and is well known due to iconic brands like Spam, Jennie-O turkey, and Skippy peanut butter.

Hormel is especially recession-resistant because products like Spam tend to be priced on the cheaper side, making them popular with preppers and people who are looking to save money by buying in bulk.

Hormel reported second-quarter earnings on May 21, and the results show resilience to challenges in the economy. Net sales were up 3% to $2.4 billion on strength in the company's grocery products segment, which saw volumes increase by 7% in the quarter. Hormel's Jennie-O Turkey Store also performed well, with sales volume up by 19% as consumers stocked up on meat products amid fears of a shortage during the pandemic.

Hormel boasts a dividend yield of 1.93% and has increased its payout for an impressive 53 years in a row. This demonstrates a track record of the company returning value to shareholders throughout thick and thin.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.