Absolutely. Stick with companies that boast impregnable balance sheets and healthy earnings prospects. International Business Machines (IBM) certainly meets those requirements. IBM's third-quarter profits leaped 22%, defying naysayers who expected the technology titan to miss forecasts.

At 8X trailing profits, Big Blue is selling at its lowest in 13 years, when the company was in the early stages of its historic makeover into a services-oriented organization. Debt is modest; indeed, IBM is one of the few corporations strong enough to borrow money at reasonable rates, even in today's climate. I'm projecting a 30%–40% total return within a year.

Besides cash-rich technology issues like Beamer, I'm attracted to the nation's prime defense contractors. The world's precarious security situation makes it all but certain that the U.S. government will continue to modernize our weapons systems — a process that takes big bucks.

You'll hardly go wrong with any of the leading defense contractors, but I especially like one that I've recommended to my readers.

This defense stalwart is selling at a trifling 9X earnings, about 50% below the stock's P/E five years ago. Such a huge discount gives you a margin of safety in the event of a slowdown in defense spending.

Moreover, this company has taken care to beef up its balance sheet during the recent prosperous years. Since 1999, the company has slashed its long-term debt by more than 70% — an astonishing feat. Cash balances stand at a record $3 billion.

If there's such a thing as a recession-proof business, this is it. I'm projecting 30% (or more) returns over the next 12 months.

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