Converse of a recession seems to dominate the current market discussion, with traders keeping contrasting feelings in excess of when just one will strike, how extensive it will previous, and what the lingering aftershocks will bring. This can make it tricky for buyers to put together their portfolios for a probable downturn. Mainly because of this, Morgan Stanley compiled a record of fortress stocks that could situate and safeguard investors’ portfolios for a pending economic downturn. “With adequate liquidity and solvency to operate functions and company personal debt, these shares should really have greater draw back safety than common,” wrote strategist Todd Castagno in a be aware Tuesday. The display screen featured Russell 1000 firms — excluding financials, true estate and utilities — with strong harmony sheets and liquidity, that fulfilled the next criteria: Hard cash as a percentage of company worth better than 2.5% Predicted optimistic no cost dollars move growth around the subsequent two years Return on invested funds envisioned in each and every of the following two many years of additional than 7.5%. A present-day property above liabilities ratio higher than 1 Small leverage, with a financial debt-to-equity ratio of much less than 2.5 This display screen also includes businesses with investment-quality credit rating scores and excludes those with unfavorable fairness. Preferred off-rate retailer Ross Shops produced Morgan Stanley’s checklist. Shares are up 2% this 12 months following a near 20% rally this thirty day period on greater-than-envisioned benefits. The stock ranked as the most effective performer in the S & P 500 for the buying and selling week that ended Nov.18, when it surged 17% . It features a cash-to-organization worth of 11.3%, with totally free dollars flows envisioned to increase just 1.6% following year, in advance of leaping to almost 31% the 12 months right after. Networking equipment and software program firm Cisco also met the criteria. Before this thirty day period, the organization described quarterly benefits that exceeded analysts and lifted its direction for the fiscal 2023 12 months. The firm’s free of charge dollars flows are forecasted to increase 20.9% subsequent year and 11.1% the subsequent yr. On the tech front, Airbnb made the minimize together with computer software company Zscaler . The shares are off by 42% and 58%, respectively, this yr, and offer you dollars as a percentage of business value of 10% and 8.2%. A the latest CNBC Professional display found Zscaler between some of the Nasdaq 100 stocks that could lead tech better likely ahead. A number of semiconductor names had been integrated in the display screen, which include Qualcomm , which delivers hard cash as a percentage of organization worth of 4.3%. The business is anticipated to mature free of charge funds flows by 64% up coming year, but that is forecasted to sluggish to just 17.4% the next calendar year. Microsoft , Hoka-operator Deckers Outside , Merck and Johnson & Johnson also manufactured the listing. — CNBC’s Michael Bloom contributed reporting