Experts are predicting record voting numbers this year and we have suggestions for a victory from either side to help strengthen your portfolio
Oct. 24, 2020
Investments, like voters, can be partisan and can benefit from a particular administrative party victory. Whether the issue is marijuana legalization, healthcare, defense, or the environment, the person occupying the White House may have a significant impact on your portfolio. We present you with two stocks that will prosper under Biden’s leadership and two under Trump’s.
Although Tesla (NASDAQ: TSLA) has performed remarkably well during the last four years under Trump (stock price up over 770% since he took office), a Biden presidency can boost the company to even more astonishing heights. In the U.S., Elon Musk’s electric vehicle (EV) company holds an impressive 82% market share in the sector, so any legislation affecting EV will most certainly influence the company’s bottom line. On that front, Biden feels that the U.S. would benefit from supporting green companies like Tesla and wants to incentivize them to build half a million public EV charging stations nationwide; a substantial step up from the current 25,000.
Additionally, Biden wants to increase tax breaks and tax credits to stimulate not only the production of EVs but sales as well. Furthermore, he hopes to replace all of the government’s traditional vehicles with EVs. Tesla’s stock price is up nearly 400% year-to-date (YTD) and its revenue is up over 20,000% in the last decade, and under Biden’s legislation, it will continue to grow.
2. UnitedHealth Group
UnitedHealth Group (NYSE: UNH) is the largest medical insurance provider in the U.S. and holds over 14% market share. Little wonder that it led the health-care stock rally — gaining nearly 11%-when Joe Biden was victorious on Super Tuesday. The reason for this is because Biden has always championed a Medicare-like government option for health plans. As the market leader, UnitedHealth stands to profit because it specializes in Medicare supplemental plans, and Biden’s expansion proposal can usher in 23 million newly eligible individuals. The company is up over 12% YTD and its revenue is up over 155% in the last decade. UnitedHealth pays a quarterly dividend of $1.25.
1. Lockheed Martin
Lockheed Martin (NYSE: LMT) prospered under the Trump presidency as he loosened policies on foreign weapons sales and increased the defense budget by over 22% in the last four years to $740.5 billion. The company is the largest in the defense sector, with a 30% market share in the U.S., and with contractors receiving more than half of the defense budget, Lockheed Martin profited and will continue to boost its bottom line under Trump. The company’s revenue is up over 30% from 2017 to a projected $65.25 billion this year. Additional lifting of restrictions on foreign arms is forthcoming.
2. Innovative Industrial Properties
You would expect the marijuana industry to suffer under Republican rule, but restrictions will benefit real estate brokers for the industry. This is what Innovative Industrial Properties (NYSE: IIPR) does — the company provides long-term leases for marijuana growers in the U.S. The marijuana industry has been in decline since the Green Rush, losing over 70% in value; but win or lose, you still have to pay rent.
Should Trump be victorious in November, federal legalization will be averted and growers will not have access to financing from banks for a property as their product is illegal. This will ensure that Innovative Industrial Properties will continue to profit as the only such organization in the sector. The company’s stock price is up nearly 80% YTD, its revenue is up 650% since Trump took office in 2017, and it raised its quarterly dividend $0.17 this year to $1.17, a 3.63% yield. These numbers are unheard of in the marijuana industry and will continue to grow for Innovative Industrial Properties should Trump remain in office.
MyWallSt operates a full disclosure policy. MyWallSt staff currently hold long positions in companies mentioned above. Read our full disclosure policy here.