Just by checking Div Aristocrats we can see some interesting info . Out of 65 stocks
13 are Industrial sector,
11 Consumer staples,
8 Consumer Discretionary
7 Financial (however there are diversified banks, regional banks, financial data and insurance companies all togheter)
6 Basic Materials
We can see easily which sectors are most ‘safe’ or rather ‘defensive’. During recession Real Estate, energy/oil companies and banks take the biggest hits. Why? Simply because people cut their spending dramatically. They tend to spend less on some extra pleasure stuff like going out to cinema, getting a new car, travelling around the worlds (oil companies) and surely they dont buy new houses/flats (Real estate). Companies during recession make less acquisitions and investments - they take less loans/credits (banks). Technology gets obsolete very fast nowadays. All we care during recession is our Health, some food to eat and basic household products which seems about to be right with these statistics above.
For me the key to this success is a lil bit sophisticated but also its simple. Most of Aristocrats simply have a very good cashflow balance, HUGE advantage over others in their sector/niche and Very nice margins. This give them a nice position at the beginning of recession. For example Coca-Cola can change the price of a bottle by 0,01$ and this will make an ENORMOUS BOOST in their finances.
Moreover as Graham said in Inteligent Investor (if i remember well) most of the profits during inflations times came out from dividends 30-40%. Stocks didnt move much during that period but dividends made a huge difference.
Coming back to Healthcare sector. I work in hospital and i know most of the products from JNJ, PFE, ABBV, BMY and MRK. If I could i would buy all of them, but as i am doing my investments step by step. Im going to add MRK later, probably during next rebalancing. Especially with all new data about Ivermectin and COVID. I must admit that healthcare is a really good, stable and safe sector, as all of us primarily care about our Health plus i know a lil bit about it haha
here is graphic I found some time ago. I think no comment is needed here
THanks for your comments.
Will add more info here if ill change anything with my Dividend PIE.