Are cyclical stocks suitable for long-term investors?

Many cyclical stocks are suitable for long-term investors. Several cyclical companies have taken steps to make their businesses more resilient by maintaining strong financial profiles, ensuring they can continue to grow and pay dividends during a cyclical downturn.

Is Amazon a cyclical stock?

Yes, Amazon would be considered a cyclical stock. Its e-commerce business would be sensitive to cyclical changes in consumer discretionary spending. Likewise, its cloud computing business (AWS) would be sensitive to changes in corporate investment.

Do cyclical stocks pay dividends?

Yes, many cyclical stocks pay dividends. Many have strong businesses and financial profiles, allowing them to continue paying and growing dividends during a cyclical downturn. However, others with weaker financial profiles might need to suspend their dividends during a deep economic downturn.

Are cyclical stocks a good hedge against inflation?

Cyclical stocks can be a good hedge against inflation under certain conditions. They tend to be a good hedge when consumer spending is strong because that gives them pricing power. However, they're not a good inflation hedge during periods of high interest rates or when discretionary spending is falling.

Is there an ETF for cyclical stocks?

There isn't one specific ETF focused on cyclical stocks. However, several ETFs focus on cyclical sectors, such as consumer discretionary (e.g., Consumer Discretionary Select Sector SPDR Fund (NYSEMKT:XLY)) and industrial (e.g., Industrial Select Sector SPDR Fund (NYSEMKT:XLI)).

Can cyclical stocks be part of a retirement portfolio?

Cyclical stocks can be part of a diversified retirement portfolio. Ideally, you'd want to hold the highest quality companies in a retirement account, especially those tied to the economic cycle.

How often should I review my cyclical stock investments?

You should review your cyclical stock investments at least once a year to ensure they remain financially strong. You should also consider reviewing your cyclical stock investments after a market dip driven by concerns that a recession could be on the horizon.

4 Best Cyclical Stocks to Buy in 2026 and How to Invest

By Matthew DiLallo – Updated Sep 14, 2026 at 1:03 PM EST | Fact-checked by Frank Bass

Key Points

Cyclical stocks can be highly volatile, rising in economic expansions and declining sharply during recessions.
Top cyclical stocks like Disney and Airbnb can deliver more durable growth during cyclical downturns.
Investing in cyclical stocks offers the potential for significant returns during an economic growth cycle.

A cyclical stock is one whose underlying business generally follows the economic cycle. Cyclical companies perform well during expansions but typically see declining sales and profits during recessions and other economic slowdowns. This contrasts with defensive stocks, which tend to generate steady profits in good times and bad.

Key characteristics of cyclical stocks:

Demand for their products rises during expansions and falls during recessions
Profitability is highly variable -- strong in good times, often negative in downturns
Stock prices tend to be more volatile, especially near economic peaks and troughs

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GettyImages-1398219003-1200x800-5b2df79 — Image source: Getty Images.

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Four top cyclical stocks for 2026

Despite economic uncertainty, some cyclical stocks have strong long-term tailwinds that could help them thrive even if headwinds intensify. Here are four top cyclical stocks worth considering.

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Ticker Information Table
Name and ticker	Market capMarket cap calculated using publicly traded shares outstanding only. Does not include unlisted, private, or dual-class non-traded shares. Implied market cap may vary.	Dividend yield	Industry
Walt Disney (NYSE:DIS)	$184.7 billion	1.40%	Entertainment
Airbnb (NASDAQ:ABNB)	$98.8 billion	0.00%	Hotels, Restaurants and Leisure
EPR Properties (NYSE:EPR)	$4.4 billion	6.37%	Specialized REITs
Nucor (NYSE:NUE)	$59.1 billion	0.86%	Metals and Mining

Data as of Sep 17, 2026. Showing 4 of 4 total entries.

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1. The Walt Disney Company

NYSE: DIS

Walt Disney

Premium Feature

Moneyball Superscore

74/100

Today's Change

(-0.89%) $-0.95

Current Price

$106.04

Key Data Points

Market Cap

$185B

Day's Range

$105.33 - $107.71

52wk Range

$92.19 - $117.09

Volume

3.7M

Avg Vol

10.3M

Gross Margin

32.19%

Dividend Yield

1.40%

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2. Airbnb

NASDAQ: ABNB

Airbnb

Premium Feature

Moneyball Superscore

78/100

Today's Change

(-0.84%) $-1.41

Current Price

$166.10

Key Data Points

Market Cap

$99B

Day's Range

$165.60 - $169.31

52wk Range

$110.81 - $193.45

Volume

996.9K

Avg Vol

4.4M

Gross Margin

72.56%

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Airbnb (ABNB -0.85%) is a leading online vacation rental platform. While vacation demand tends to decline during a recession, Airbnb's platform should remain highly resilient. It's focusing on four key areas to drive consistent growth: improving its service, expanding into more regions, enhancing its offerings, and integrating AI into its app.

The company wants its app to be a lot like Amazon (AMZN +2.10%). It aims to be the go-to source for travel and living needs. The company intends to build several new businesses in the coming years. It plans to start by investing in experiences that enhance user stays, such as local tours. Airbnb also anticipates expanding into other areas, such as partnering with companies like grocery stores and cleaning services. The company's expansion strategy should enable it to continue growing even in a cyclical downturn in travel.

Airbnb's strategy is already paying dividends. Its revenue was up 17% in the second quarter of 2026 to $3.6 billion, driven by a 16% increase in gross booking value to $27.2 billion.

3. EPR Properties

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NYSE: EPR

EPR Properties

Premium Feature

Moneyball Superscore

67/100

Today's Change

(0.54%) $0.31

Current Price

$57.32

Key Data Points

Market Cap

$4.4B

Day's Range

$56.70 - $57.41

52wk Range

$48.10 - $64.97

Volume

302.4K

Avg Vol

742.3K

Gross Margin

51.22%

Dividend Yield

6.37%

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EPR Properties (EPR +0.54%) is a real estate investment trust (REIT) focused on owning experiential real estate, including movie theaters, ski resorts, eat-and-play locations, and other attractions. Demand for these experiences tends to decline during a recession. However, an economic downturn is unlikely to have as significant an impact on EPR Properties as it would on other companies, given its business model.

The REIT leases its properties to operating tenants under long-term triple net (NNN) agreements. Those leases supply it with a very stable rental income, as tenants cover all operating costs, including routine maintenance, real estate taxes, and building insurance. EPR pays out a conservative percentage of its steady cash flow via its monthly dividend. The REIT reinvests the remaining funds to acquire additional income-producing experiential properties. In 2026, it closed the $304 million purchase of seven regional theme parks from Six Flags (NYSE:SIX), which it is leasing to two new operators. Those investments will help grow its rental income, enabling the REIT to continue increasing its high-yielding dividend (a 5.1% increase in 2026).

4. Nucor

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NYSE: NUE

Nucor

Premium Feature

Moneyball Superscore

84/100

Today's Change

(1.93%) $5.03

Current Price

$265.71

Key Data Points

Market Cap

$59B

Day's Range

$263.89 - $268.08

52wk Range

$131.32 - $280.11

Volume

369.5K

Avg Vol

1.5M

Gross Margin

15.44%

Dividend Yield

0.86%

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Steel producer Nucor (NUE +1.93%) tends to be highly cyclical since demand for steel ebbs and flows with the economy. When the economy is expanding, companies use more steel to construct buildings, cars, and other industrial goods. However, steel demand tends to decline during a recession.

While Nucor could eventually see a slowdown in steel demand, it's benefiting from increased infrastructure spending. The company's business has also proven more resilient than that of others in the steel sector over the years, as evidenced by its dividend. As of mid-2026, Nucor had paid 213 consecutive quarterly dividends. It has increased its dividend payments for 53 straight years -- every single year since it first paid dividends in 1973 -- qualifying it as a Dividend King, a company with 50 or more years of annual dividend increases.

How to buy cyclical stocks

Here's a step-by-step guide on how to invest in cyclical stocks:

Open your brokerage app: Log in to your brokerage account where you handle your investments. If you don't have one yet, take a look at our favorite brokers and trading platforms to find the right one for you.
Search for the stock: Enter the ticker into the search bar to bring up the stock's trading page.
Decide how many shares to buy: Consider your investment goals and how much of your portfolio you want to allocate to this stock.
Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
Submit your order: Confirm the details and submit your buy order.
Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.

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Benefits and risks of investing in cyclical stocks

Some of the advantages of investing in cyclical stocks include:

Benefiting from economic growth: Cyclical companies tend to see increased demand for their products and services as the economy expands.
Potential inflationary hedge: Cyclical companies can help you hedge your portfolio against inflation when consumer spending is rising.
Income: Many cyclical stocks pay dividends, which can be higher during periods of economic growth.

Meanwhile, some of the risks of investing in cyclical stocks include:

Variable earnings: The profitability of cyclical companies tends to ebb and flow with the economic cycle.
Dividend cuts: Cyclical companies are more likely to cut dividends during an economic downturn.
Financial issues: A severe economic downturn can cause significant financial problems for some cyclical companies.

Methodology: How these stocks were chosen

I evaluated cyclical stocks based on the following traits:

Balance sheet strength: I sought out companies with strong, investment-grade balance sheets and low leverage relative to peers. This will enable a cyclical company to rely on its balance sheet to navigate through the low point of the economic cycle.
Durable competitive advantages: I looked for companies with notable advantages over rivals, such as brand power, low-cost operations, and strong customer relationships. They can use their competitive advantages to take market share during an economic downturn.
Secular growth drivers: I looked for companies capitalizing on a longer-term growth trend that should remain durable during a recession (e.g., travel, experiences, and infrastructure spending).

This group stood out as they scored highly across these durable characteristics.

Should you invest in cyclical stocks?

Most portfolios should hold some cyclical stocks as part of a blend with more defensive holdings. That way, you're positioned to benefit when the economy grows, while your defensive holdings provide some cushion when it contracts.

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FAQ on cyclical stocks

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About the Author

Matt DiLallo has been a contributing Motley Fool stock analyst specializing in the energy, industrials, and real estate sectors since 2012. He also covers dividend-paying stocks, pre-IPO companies, ETFs, and other investing topics. He holds an MBA from Liberty University.

TMFmd19

@MatthewDiLallo

JPMorgan Chase is an advertising partner of Motley Fool Money. Matt DiLallo has positions in Airbnb, Amazon, Apple, Coca-Cola, EPR Properties, JPMorgan Chase, NextEra Energy, Realty Income, and Walt Disney and has the following options: short March 2026 $125 calls on Walt Disney and short May 2026 $280 calls on Apple. The Motley Fool has positions in and recommends Airbnb, Amazon, Apple, Boeing, Costco Wholesale, EPR Properties, JPMorgan Chase, NextEra Energy, Realty Income, Texas Roadhouse, and Walt Disney. The Motley Fool recommends General Motors. The Motley Fool has a disclosure policy.

4 Best Cyclical Stocks to Buy in 2026 and How to Invest

Key Points

Four top cyclical stocks for 2026

1. The Walt Disney Company

Key Data Points

2. Airbnb

Key Data Points

3. EPR Properties

Key Data Points

4. Nucor

Key Data Points

How to buy cyclical stocks

Benefits and risks of investing in cyclical stocks

Methodology: How these stocks were chosen

Should you invest in cyclical stocks?

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FAQ on cyclical stocks

Are cyclical stocks suitable for long-term investors?

Are cyclical stocks suitable for long-term investors?

Is Amazon a cyclical stock?

Is Amazon a cyclical stock?

Do cyclical stocks pay dividends?

Do cyclical stocks pay dividends?

Are cyclical stocks a good hedge against inflation?

Are cyclical stocks a good hedge against inflation?

Is there an ETF for cyclical stocks?

Is there an ETF for cyclical stocks?

Can cyclical stocks be part of a retirement portfolio?

Can cyclical stocks be part of a retirement portfolio?

How often should I review my cyclical stock investments?

How often should I review my cyclical stock investments?

About the Author

Read Next

Stocks Mentioned

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Premium Investing Services

Four top cyclical stocks for 2026

Benefits and risks of investing in cyclical stocks

Methodology: How these stocks were chosen

Should you invest in cyclical stocks?

Best Bank Stocks for Dividends in 2026 and How to Invest

Best Automotive Stocks for 2026 and How to Invest

10 Best Growth Stocks for 2026

7 Best Travel and Tourism Stocks for 2026 and How to Invest

FAQ on cyclical stocks

Are cyclical stocks suitable for long-term investors?

Are cyclical stocks suitable for long-term investors?

Is Amazon a cyclical stock?

Is Amazon a cyclical stock?

Do cyclical stocks pay dividends?

Do cyclical stocks pay dividends?

Are cyclical stocks a good hedge against inflation?

Are cyclical stocks a good hedge against inflation?

Is there an ETF for cyclical stocks?

Is there an ETF for cyclical stocks?

Can cyclical stocks be part of a retirement portfolio?

Can cyclical stocks be part of a retirement portfolio?

How often should I review my cyclical stock investments?

How often should I review my cyclical stock investments?

3. EPR Properties

How to buy cyclical stocks

Key Data Points

Key Data Points

Key Data Points

Key Data Points

4. Nucor