3 Beaten-Down Stocks to Buy if There Is a Recession

Retailers and restaurant operators are indicating that U.S. consumers face mounting financial pressures, despite broader economic metrics appearing resilient due to artificial intelligence investments and corporate efficiency gains. Potential catalysts such as surging energy prices could further strain household budgets. In response, analysts highlight three beaten-down consumer-facing stocks positioned to outperform during an economic downturn: Netflix, Walmart, and Chewy. Netflix (NFLX) is highlighted as a primary low-cost entertainment provider that benefits when consumers cut out-of-home leisure spending. The company recorded 13% revenue growth and an 11% increase in adjusted EPS in its latest quarter, while expanding ad-supported tiers and live events. Down approximately 40% over the past year, Netflix trades at an attractive forward price-to-earnings ratio of roughly 21 times 2026 estimates. Walmart (WMT) and Chewy (CHWY) round out the defensive picks due to consumer trade-down trends and non-discretionary pet care spending. With Chewy generating nearly 85% of revenue via its autoship program and trading below 11.5 times forward earnings, defensive consumer equities offer compelling risk-reward profiles amid macroeconomic headwinds.