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If the stock market crashes, the last thing you want is a business that needs a bull market to keep making money.
Our latest stock pick offers something different. It provides essential financial data and services that customers rely on through good times and bad. And more excitingly, heightened market volatility actually tends to boost activity in parts of its business.
That’s why we’ve just recommended the one UK stock we believe deserves a closer look from investors seeking a more resilient portfolio. Not because its shares can’t fall, but because there’s a crucial difference between a falling share price and a business losing its earning power.
So, what makes this latest Share Advisor stock pick so exciting?
- 73% of its income is recurring, giving it a dependable revenue base rather than relying on markets rising to keep customers spending.
- Dividends have compounded by a remarkable 17% for 20+ years even after a global financial crisis, the pandemic, and soaring inflation.
- It’s a cash-generating machine that printed £2.4bn in free cash flow last year alone.
As our Senior Investment Analyst, Mark Stones, puts it:
“It provides access to crucial markets’ data and the breadth of its offering isn’t available elsewhere – resulting in a 98% annual customer retention.”
Mark Stones, Share Advisor
Of course, there is risk.
Defensive doesn’t mean crash-proof. Its shares could fall sharply in a wider sell-off, and a prolonged downturn could put pressure on customer spending and market-linked revenues. And let’s also not forget the threat of cyberattacks, regulatory scrutiny, and emerging AI competition.
But over the long term, history has shown that its stellar combination of recurring income and cash generation has made it one of the best-performing defensive stocks on the entire UK stock market.
Of course, no single stock can protect an entire portfolio. But for those seeking a business that helps keep the financial world running we believe this company makes a compelling case.
Our Latest Defensive Stock Recommendation
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This story originally appeared on Motley Fool
