If price were the only yardstick, an investor could rush right out and scoop up bargains by the handful. Hundreds of stocks are selling for a fraction of what they cost just a short time ago. But savvy investors are likely to be cautious, realizing that a stock that's cheap today may be no bargain if it is going to be a lot cheaper tomorrow.

Although stocks have been badly battered, they may be headed even lower for a variety of reasons, not the least of which is the economic slowdown that is widely expected to follow the stock market collapse. A significant part of that slowdown, or recession, is a tightening of consumer spending.

All of this makes the "recession factor" a very real consideration in stock selection. Before investors buy or sell a stock, they must ask themselves, "If we get into a recession, how is the business of XYZ Corp. -- and its stock price -- going to be affected?"

In the case of the furniture business, which is an important industry in Virginia, the answer is pretty clear. Even the hint of a recession is bad news for furniture sales. Any rise in interest rates can hinder the financing of furniture purchases just as it can discourage new home construction and the sale of furniture to fill those homes.

"Furniture is a deferrable purchase," said Wallace W. (Jerry) Epperson Jr., of Wheat, First Securities in Richmond, summarizing the economic sensitivity of the business, which he has followed for 20 years.

The prices of furniture stocks were cut by as much as 50 percent during October, Epperson said. Since then, some of the stocks have come back a bit but they are still down.

Between Oct. 2 and last Friday, Bassett Furniture of Bassett, Va. was down 32.8 percent; Pulaski Furniture of Pulaski, Va., was down 27.7 percent; Rowe Furniture of Salem, Va., was down 27.3 percent; and Ladd Furniture of High Point, N.C. was down 37.3 percent. Furniture retailer Heilig-Meyers of Richmond was off 47.4 percent.

Normally, when the stocks of an entire industry become cheap, as measured by the usual yardsticks, one could expect those stocks to be in demand, Epperson said. But not now. "I think I'm an analyst for an industry nobody wants," he said.

Since the big stock drop of Oct. 19, Epperson has been watching his industry more intently than ever. In an ironic bit of "market timing," the Fall Southern Furniture Market in High Point, N.C., was in full flower during the week of the stock market collapse. But for three weeks after the plunge, Epperson said, he saw no impact on furniture sales from the loss of wealth suffered by potential buyers.

In the last few weeks, however, that picture has begun to change. "We've begun to see some minor cracks or slowdowns," he said. So far, retailers tell him, the changes have been subtle, Epperson said.

Customers seem somewhat fewer, more cautious and more conservative, Epperson said. It could be a seasonal problem, with Christmas shopping diverting customers' attention, he noted. He's not completely sure but he's lived through three previous recessions, so he knows the signs.

Epperson's sense of a slowdown at the retail level is confirmed by Irwin L. Lowenstein, president of Rhodes Furniture, which operates 90 retail stores in nine southern states. Lowenstein said sales in his stores have been sluggish in recent weeks. However, he thinks the slowdown began even before the stock market's fall because of the high level of consumer debt.

"It got worse after Black Monday," Lowenstein said. Then market's tumble, he added, "caused the consumer to have less confidence."

In the last few weeks, Lowenstein said, the Rhodes stores have seen about the same number of customers as before but "there have been reductions in the amount they bought." Many bought only merchandise that was on sale.

Epperson said he is worried by the scenario that often follows a slowdown in sales. Some manufacturers and retailers try to trim their costs by cutting back on advertising and promotion instead of doing what auto companies do -- increasing promotion.

Some retailers do not replace the furniture that has been sold and wind up with a showroom floor full of pieces that didn't sell in the first place. When business gets tight, some retailers also tend to load up on furniture that manufacturers offer on special deals, rather than with furniture that sells best.

Thus, in the post-October world, if investors look at furniture stocks at all, they will try to figure out which companies are best equipped to survive a recession.

Epperson thinks that Ladd Furniture of High Point, N.C., is one company that can make it through the bad times. "If the industry is down 20 percent, they'll be down one half of that," he said.

Epperson's opinion of Ladd is shared by Barbara T. Alexander, an analyst for Salomon Brothers in New York, who sees a silver lining in the recession cloud for Ladd, a company that has grown rapidly by buying other companies.

Ladd's most recent acquisition was American Furniture Co., of Martinsville, Va., for which it paid $39 million.

Alexander noted that "an economic downturn could provide {Ladd} with even more appealing acquisition opportunities."

Moreover, because the companies acquired by Ladd generally have been able to contribute to Ladd's profits in the first year of the combination, it could mean that Ladd's earnings would improve, Alexander said.

Ladd shares are now selling at $11.75, the low for the last 52 weeks, during which the stock has been as high as $24.75.

Epperson forecasts earnings of $1.45 a share for 1987 and $1.65 a share for 1988, while Alexander foresees $1.50 for 1987 and $1.85 for 1988. Ladd earned $1.16 in 1986.

While both analysts are optimistic about the business fundamentals at Ladd, they feel that Ladd's stock price does not reflect those strong points. Alexander observed wryly that, in theory, the stock market is supposed to accord similar values to the shares of companies with similar characteristics.

"But nowhere does the theory specify how long this process may take," she said. That being the case, she said, Ladd shares might be of interest to investors with a 3-year to 5-year time horizon.

Vanguard Technologies International of Fairfax has won support from the State of Wisconsin Investment Board, which manages $15 billion in pension fund money. John F. Nelson, head of the special equity division, has invested about $2 million in 162,800 shares of Vanguard's class A shares. That represents 9.94 percent of Vanguard stock, he said. Nelson began buying the stock when it was around $20 a share and continued to buy it as the price dropped, down to $9 a share.

Nelson said he likes Vanguard's management and believes the company can continue to grow at 20 to 25 percent. Vanguard, which had fiscal 1987 revenue of $38.4 million, provides automatic data processing services to government and industry.

Greater Washington Investors Inc. of Chevy Chase has acquired the portfolio of Michigan Capital and Service Inc., the small business investment company (SBIC) subsidiary of the National Bank of Detroit. The acquisition cost $5 million and boosted the GWI portfolio from $21.8 million to $32.6 million and from about 40 companies to about 60 companies. Michigan Capital, like GWI, often has provided funding for early-stage, technology-based companies. Financing for the deal was arranged with the National Bank of Detroit.

GWI, incidentally, is in the process of separating its SBIC activities from its other venture capital business. The move will give GWI greater freedom, such as investing overseas. It also will allow GWI's SBIC to increase its loans from the Small Business Administration. Marty Pinson, GWI's senior vice president, said that the result will be to create a $10 million SBIC out of what has been a $28 million combined company.

When markets fall, brokerage and mutual fund stocks are the first to head south. T. Rowe Price, the Baltimore mutual fund giant, went public at $24 and saw its shares rise as high as $51. But the market plunge took the stock down to $17.50. Thus far, the stock has recovered to $19. Other area firms also have watched their shares fall into deep declines. Alex. Brown & Sons, with a 52-week range of $28 to $8.50, is now selling at $8.75. Scott & Stringfellow, which has traded as high as $14.50, is now at a low of $8. And Legg Mason, which has been as high as $24.50, is now trading at $9.6