Play ultimate defense with these stocks that rise when volatility goes wild on Wall Street

Published Mon, Mar 13 20233:47 PM EDT

Hakyung Kim @https://www.linkedin.com/in/hakyungkim/@hakyungkim_

As market uncertainty grows with the ongoing banking crisis, investors can look to certain stocks to beat the Street when there are stressful conditions. Investor confidence has wavered following the collapse of Silicon Valley Bank and Signature Bank . The Cboe Volatility index (VIX) , Wall Street's preferred fear gauge, reached a level not seen since late 2022 and neared territory considered highly risky . The volatility index is already up seven points this month, putting it on pace for one of the biggest pops in the last 10 years if the trend continues. To find volatility winners, CNBC Pro screened for stocks that tend to rise when the volatility index gains. This is not normal as most stocks fall when fear is high on Wall Street and the VIX pops. We screened the 1,500 largest U.S. stocks and looked at their performance during the 10 biggest monthly moves higher in the VIX during the last 10 years. These stocks had a median advance of at least 1% during those months when volatility surged. What came back were stocks that have stable businesses with steady cash flows. The companies sell things like beer, food, and electricity. Utilities company PG & E made the list of biggest risers amidst instability on the Street, with a median 4.6% gain. Analysts are bullish on PG & E shares, with eight out of 13 analysts covering the stock giving it a buy rating. The average price target for the stock is $18.73, implying 17.8% upside from Friday's close price. Shares have dropped 2% in 2023, but have rallied almost 42% during the past 12 months. The two energy groups on the list are Coterra Energy and EQT . Coterra Energy has the highest median gain of 4.6% on the list. Shares have remained flat in 2023, while gaining 6% in a 12-month period. Beer manufacturer Molson Coors is another stock that beats the market during times of volatility. Shares have risen 1.6% year-to-date and 3% over the last 12 months. Meanwhile, analysts are mixed on the stock — with the majority of those covering the stock issuing a hold rating — and anticipate shares having a 4.6% upside. Other consumer names to make the list were Bath & Body Works , J.M. Smucker, Flowers Foods , and Stride . Bath & Body Works has a median gain of 2.3%. Its shares have fallen 12% so far in 2023 amidst a 20.3% decline during the past 12 months. However, analysts believe the stock is a buy and estimate almost 39% upside this year. —CNBC's Michael Bloom contributed to this report.