10 Stocks to Buy in the Next Stock Market Crash

We’re currently living in a stock market bubble, where many companies are trading at prices far above realistic valuations. While there’s mixed consensus as to how long this trend can continue, plenty of investors are concerned about another stock market crash. Ongoing economic concerns are also fueling general uneasiness regarding another potential downturn.

But with volatility comes opportunity, and you'll want to be prepared to make the most of the chance to buy good stocks at a discount. These are 10 stocks you’ll want to consider buying in the next stock market crash.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

Shares of multinational technology company Microsoft (NASDAQ: MSFT) are up roughly 26% year to date, and the company is trading at 35 times its earnings. It just boosted its quarterly dividend by close to 10%, which currently yields about 1.1%.

Microsoft reported a stellar fiscal fourth quarter on July 22, with revenue up 13% year over year and its operating income rising by 8% compared with the same quarter in fiscal 2019. The company’s key revenue drivers include both its commercial and consumer Office products and cloud services segments. Revenue in these divisions was up 5% and 6%, respectively, in fiscal Q4 2020. Microsoft closed the full fiscal year 2020 reporting $143 million in revenue, a 14% increase from fiscal 2019.

ALSO READ: Will Microsoft Be a $2 Trillion Stock?

TV streaming platform Roku (NASDAQ: ROKU) is proving its mettle as a fantastic growth stock. Last year, before the pandemic began, the company increased its net revenue by 52% year over year and platform revenue by 78% from 2018. Roku closed out 2019 with nearly 37 million active accounts and reported its gross profits up by 49%.

The company has gone from strength to strength in 2020. Although shares fell in the March dip, the stock is now up about 20% from January. Roku reported its Q2 earnings results on Aug. 5. The company’s total net revenue rose by 42% during that three-month period compared with Q2 2019, with platform revenue up 46% and gross profits increasing by 29%. As of Q2, Roku hit 43 million active accounts on its platform. The company has $887 million in cash on its balance sheet.

Multinational retailer Walmart (NYSE: WMT) has remained resilient despite pandemic volatility. The company’s growing e-commerce segment has helped to bolster its earnings and cement the strength of its balance sheet, despite the tough times that many brick-and-mortar retailers are facing right now.

In Walmart’s earnings for the first quarter of fiscal 2021, which it released on May 19, the company reported comparable sales growth of 10%, while its e-commerce sales were up by 74% in the quarter. The company released its Q2 earnings for fiscal 2021 on Aug. 18, in which it reported 9.3% comparable sales growth and 97% e-commerce sales growth. Although the company’s international net sales were down by nearly 7%, its consolidated operating income grew 8.5%. Walmart currently has $15.4 billion in free cash flow on its balance sheet.

The company is a Dividend Aristocrat, having raised its dividend for 43 consecutive years. Walmart’s dividend yield is roughly 1.6%.

PetMed Express (NASDAQ: PETS) is a small-cap stock with a roughly $615 million market capitalization, but its nearly 4% dividend yield is an attractive buying point. The online pet pharmacy reported its results for the first fiscal quarter of 2021 on July 20. During that period, which ended on June 30, PetMed reported a 20% increase in sales with a 47% boost to its diluted earnings per share (EPS). PetMed attracted over 180,000 new clients in fiscal Q1 2021, with a 19% increase in reorder sales and a 29% increase in new order sales.

ALSO READ: 2 Things I'm Doing to Prepare for Another 2020 Stock Market Crash

Blue chip beverage corporation Coca-Cola (NYSE: KO) has a market capitalization of more than $217 billion and pays a dividend that yields 3.2%. Because the company has increased its dividend for more than 50 consecutive years (58, to be precise), it is one of a handful of stocks known as Dividend Kings.

In 2019, Coca-Cola reported 9% revenue growth with operating income up 10% year over year. In the most recent quarter, which ended on June 26, the company reported net revenue down by 28% with operating income dropping by 34%. Management attributed this earnings decrease to the pandemic and believes that other quarters will show less of an impact.

Even though shares of the company are still down from January, I believe the stalwart makes a great addition to any basket of stocks. The company has been in business for over 128 years, and despite the short-term headwinds it has faced due to the pandemic, Wall Street analysts anticipate that the company will grow its earnings by more than 14% next year.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

Heating, ventilation, air-conditioning, and refrigeration (HVACR) company Carrier Global (NYSE: CARR) only recently became its own publicly traded entity, after it spun off from United Technologies in April. The company more than qualifies as a large-cap stock, with a current market capitalization close to $27 billion.

It has seen an impact from the COVID-19 pandemic, reporting a 20% decrease in sales in the second quarter ending on June 30. But the good news is that Carrier Global’s cash position is excellent. It reported that free cash flow constituted 177% of its net income in the second quarter. And despite the headwinds from the pandemic, the company raised its full-year guidance and anticipates sales for 2020 to hit in the range of $15.5 to $17 billion.

Shares of PayPal (NASDAQ: PYPL) didn’t fall dramatically when the stock market crashed in March, and they're now up 59% compared with January. The online payments systems provider has shown its recession readiness, posting consistent earnings growth in both quarters and at the height of the pandemic.

In light of ever-increasing digitization and people’s growing reliance on online solutions, PayPal’s continued revenue wins make perfect sense. The company reported revenue growth of 12% in Q1. In Q2, PayPal marked the most robust quarterly performance since its founding, with 22% year-over-year earnings growth. Payment transactions on PayPal were up 26% in the second quarter, while the company grew its total active accounts by 21%.

ALSO READ: Where Will PayPal Be in 5 Years?

Consumer staples company Clorox (NYSE: CLX) has seen demand for its products skyrocket since the pandemic began. Shares of its stock are up 36% year to date.

In the final quarter of fiscal 2020, which concluded on June 30, Clorox reported that all its businesses saw earnings increases in the double digits. The company grew its total earnings by 22% in fiscal Q4. Sales in its health and wellness, household, and lifestyle divisions were up by 33%, 17%, and 16%, respectively. Looking at the entire fiscal 2020, Clorox reported an 8% increase in sales.

The Dividend Aristocrat has raised its yield for 43 years in a row. Clorox’s dividend currently yields about 2.2%.

Given CVS Health’s (NYSE: CVS) essential business status, its long-term viability as a solid investment remains solid despite short-term interruptions from the pandemic. The stock is extremely cheap, trading at just nine times earnings.

In the second quarter ending on June 30, CVS reported 3% revenue growth. Its balance sheet has also benefited considerably from its acquisition of Aetna back in 2018. The company reported revenue growth of more than 6% in its healthcare benefits segment in the second quarter. CVS marked more than $7 billion in cash flow from operations in Q2 2020, while paying down nearly $3 billion debt during the three-month period.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

One of the many consequences of the coronavirus pandemic has been significant changes in consumer behaviors. These changes have been great news for e-commerce platforms like Etsy (NASDAQ: ETSY). Shares of the company have gained 142% so far this year, and the stock is now trading at close to 92 times earnings.

In the most recent quarter ending June 30, the company grew its earnings by 137% year over year, while its gross merchandise sales increased by 146%. During the second quarter, Etsy reported a nearly 35% growth in active sellers on the platform, as well as a 41% boost in active buyers. Analysts on Wall Street think Etsy will grow its earnings by more than 57% per year over the next five years.

ALSO READ: A Deep Dive Into Etsy

Even though it's been a tough year for the stock market, fantastic investment opportunities still abound if you know where to look.

There’s no way to foretell the future, but we know that at some point the market will inevitably make a bear market turn. Exactly when that will happen is just a guessing game at this point.

When you invest with a long-term mindset, it's important to evenly distribute your portfolio with stocks that exhibit recession-proof qualities and are well insulated for continued growth. When these kinds of stocks make up the broader part of your portfolio, you can help protect your investments from excess volatility and prepare for whatever surprises the market brings.

Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Rachel Warren has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Etsy, Microsoft, PayPal Holdings, and Roku. The Motley Fool recommends CVS Health and recommends the following options: long January 2021 $85 calls on Microsoft, short January 2021 $115 calls on Microsoft, and long January 2022 $75 calls on PayPal Holdings. The Motley Fool has a disclosure policy.