Buy these stocks with fortress balance sheets to win in the slowing economy, Morgan Stanley says

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The firm said these stocks have downside support and enough cash on hand to buy back shares or acquire companies at a discount.

Companies with strong balance sheets have a downside cushion and can find unique opportunities during a slowing economy, according to Morgan Stanley. Corporations with high amounts of cash on their balance sheets can take advantage of a slowing economy by buying back their stock or acquiring businesses at discounted prices, said Morgan Stanley strategist Todd Castagno. He said these companies can also generate substantial income from interest.

The stock was also on the minds of peers on Wall Street. On Sunday, BMO analyst Simeon Siegel reiterated his outperform rating on the stock despite some questions. "We continue to favor NKE's size and scale as long-term competitive advantages but remain concerned over hopes for meaningful margin growth," he said. NKE YTD mountain NKE in 2023 FedEx had one of the highest shares of cash compared with total enterprise value at 7.7%.

 

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