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) 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.
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Analysts called shares of "buy"-rated Wal-Mart ( WMT) "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.