Stock Survivors: Apple, Wal-Mart, Chevron

Here are three companies that offer peace of mind through strong earnings and balance sheets.
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Investors seek safety when the

economy contracts

. Among the 6,000 stocks we track, here are three that offer

peace of mind

through strong business outlooks and balance sheets.

Apple

(AAPL) - Get Report

gets praise for its innovative products, but rarely for its financial strength. The maker of the

iPod and iPhone

has no debt and $25.7 billion of cash, reflected in a quick ratio of 1.97, which provides a huge recessionary cushion. It's enough cash to fund a large acquisition if the company were to find an attractive target.

Apple's first-quarter net sales rose 5.8% to $10.2 billion from a year ago. Net income inched up 1.5% to $1.6 billion, but operating margin fell 122 basis points to 21%. While the stock fell 57% last year, it rebounded with other technology companies and has climbed 19% so far in 2009.

TheStreet.com Ratings' quantitative model rates Apple stock "hold" because of its expensive price. Its shares are trading at a premium compared to those of peers, based on its recent earnings performance and profit projections. However, the company's growth and stability might justify the higher price.

Analysts called shares of "buy"-rated

Wal-Mart

(WMT) - Get Report

"counter-recessionary" last year, when they gained 17%. Many assume the discount retailer's stock price has peaked, but it's a good time to buy.

Wal-Mart's shares are trading at a discount relative to competitors based on book value, sales, and cash flow. The stock is down 11% this year, creating a potential buying opportunity.

The retail giant has obvious weaknesses. Despite stable cash flow and revenue, the company has weak margins, sizable debt, and a lackluster cash position. Fourth-quarter revenue rose 1.3% to $109.1 billion, but net income declined 7.4% to $3.8 billion. Analysts expect the company's earnings to increase 6% to $3.55 a share during the 2009 fiscal year, which ends next January. Wall Street is optimistic about Wal-Mart.

Oil and gas giant

Chevron

(CVX) - Get Report

posted strong 2008 results. But its outlook suffered when oil prices plummeted, pushing the shares down 22% for the year.

Fourth-quarter revenue declined 28% to $43.1 billion, but earnings jumped 5.2% on improved margins. The company's profits are tied to oil prices, which have fallen to less than $50 a barrel this year after hitting a record $147 in July.

Chevron has minimal debt, illustrated by a 0.1 debt-to-equity ratio. Its cash position, reflected in a quick ratio of 0.79, is sufficient, but not ideal. Our model favors companies with quick ratios of 1 or more. But its 3.9% dividend yield is attractive.

Chevron is trading at a discount relative to peers based on earnings, sales and book value. The stock, which has dropped 13% this year, has been trading between $56 and $67 for the past month, down from its 52-week high of $104.63. The stock is poised for a jump as oil prices rebound, stoking investor optimism.