A defensive company is one whose sales, earnings, and cash flows are strongly correlated with the business cycle.

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A defensive company is one that is less affected by changes in the economy and the business cycle. Defensive companies usually have stable demand for their products or services, regardless of economic conditions. Examples of defensive companies include utility companies and consumer staples companies. Thus, their sales, earnings, and cash flows are not strongly correlated with the business cycle.

A Defensive Company Is One Whose Sales, Earnings, and Cash