Bear markets happen on occasion, and recessions are inevitable in a cyclical economy. What is most important is that investors keep their cool when the markets take a nosedive.
Investors should resist the urge to sell their stocks, and continue to hold quality dividend stocks even though it is tempting to cash out when markets are in free-fall.
These 3 bear market stocks represent high-quality businesses that are able to generate strong profits and raise their dividends, even during stock market declines.
Automatic Data Processing (ADP)
Automatic Data Processing is one of the largest business services outsourcing companies in the world. The company provides payroll services, human resources technology, and other business operations to more than 700,000 corporate customers.
ADP posted second quarter earnings on January 28th, 2026, and results were better than expected on both the top and bottom lines.
Adjusted earnings-per-share came to $2.62, which was a nickel ahead of estimates, and was up from $2.49 in Q1, and from $2.35 in the year-ago period. Revenue was up 7.2% year-over-year to $5.36 billion, beating estimates by $20 million.
Expenses came to $4.08 billion, which was higher from $3.98 billion in Q1 and $3.88 billion a year earlier. Adjusted EBIT margin was 26.0% of revenue, up from 25.5% in Q1 and from 25.2% a year ago. The company guided for revenue growth of 6% for this year, adjusted EBIT margin of ~60 basis points, and adjusted diluted earnings-per-share growth of 9% to 10%.
ADP has increased its dividend for 51 consecutive years.
Abbott Laboratories (ABT)
Abbott Laboratories, founded in 1888, is one of the largest medical appliances & equipment manufacturers in the world, comprised of four segments: Nutrition, Diagnostics, Established Pharmaceuticals and Medical Devices. Abbott Laboratories provides products in over 160 countries and employs 114,000 people. The company generated $44 billion in sales in 2025.
On January 22nd, 2026, Abbott Laboratories released fourth quarter and full year results for the period ending December 31st, 2025. For the quarter, revenue grew 4.5% to $11.46 billion, but this missed estimates by $340 million.
Adjusted earnings-per-share of $1.50 compared to $1.34 in the prior year and was $0.01 better than expected. For the year, revenue grew 5.7% to $44.3 billion while adjusted earnings-per-share of $5.15 compared to $4.67 in 2024. For Q4, U.S. sales grew 0.9% while international was higher by 6.7%. Currency exchange was a 1.4% headwind for the period.
Abbott Laboratories provided guidance for 2026 as well, with the company expecting adjusted earnings-per-share in a range of $5.55 to $5.80 for the year. At the midpoint, this would represent growth of 10.3% from 2025.
ABT has increased its dividend for 54 years.
H2O America (HTO)
H2O America, formerly known as SJW Group, is a water utility company that produces, purchases, stores, purifies and distributes water to consumers and businesses in the Silicon Valley area of California, the area north of San Antonio, Texas, Connecticut, and Maine.
It also has a small real estate division that owns and develops properties for residential and warehouse customers in California and Tennessee. The company generates about $670 million in annual revenues.
On January 26th, 2026, H2O America raised its quarterly dividend 4.8% to $0.44, extending the company’s dividend growth streak to 58 consecutive years.
On February 25th, 2026, H2O America released fourth quarter and full year results for the period ending December 31st, 2025. For the quarter, revenue declined 1.9% to $194.1 million, which missed estimates by $23.3 million. Earnings-per-share of $0.45 compared unfavorably to earnings-per-share of $0.74 in the prior year and was $0.07 below expectations.
For the year, revenue grew 7% to $800.6 million while earnings-per-share of $2.92 compared to $2.87 in 2024.
Many investors own utility companies for their reliable earnings and dividends, especially for uncertain economic times. During the last recession, H2O America experienced a decline in earnings that took several years to recover. A key competitive advantage for H2O America, is that it operates in two areas, Silicon Valley and Central Texas, that have seen high levels of population growth in recent years.
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