Trump re-election: KeyBanc says watch these health and consumer stocks
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Trevor Williams
KeyBanc analysts curated lists of healthcare and retail companies positioned to benefit from or be hurt by various policy stances from the incoming Trump administration, such as on healthcare programs and levies on imported Chinese goods.
Within healthcare services, the firm said Republican administrations have been more supportive of Medicare Advantage relative to Democratic administrations. KeyBanc will also watch if potentially looser regulations on mergers and acquisitions will allow bellwether companies to execute larger transactions.
For retail, key dynamics include potential margin headwinds if tariffs between 60%-100% on Chinese imports are implemented, housing-market recovery, and consumer spending, which KeyBanc said tends to pick up when elections are over.
Here’s a portion of KeyBanc’s watch list:
Healthcare Services
Likely beneficiaries – (NYSE:HUM), (NASDAQ:ALHC), (NYSE:UNH): Republican electoral victories will likely have a positive impact on funding related to Medicare Advantage.
(NYSE:EVH), (NASDAQ:PRVA), (NASDAQ:ASTH), (NASDAQ:INNV): Companies that are, or viewed to be, levered to Medicare Advantage economics.
Negatively affected – (NYSE:HCA), (NYSE:THC), (NYSE:UHS): Potential uncertainty for enhanced Health Insurance Exchanges subsidies and, to a lesser degree, Medicaid supplemental payments.
Consumer Hardlines/Broadlines
Negatively affected: (NASDAQ:DLTR), (NASDAQ:FIVE) due to potential tariffs on Chinese imports given fixed retail price points. (NYSE:BBY) also impacted but likely to raise prices.
(NYSE:W), (NYSE:WSM), (NYSE:RH): smaller risk exposure to potential tariffs, but could feel impacts.
(NYSE:HD), (NYSE:LOW): 10-year Treasury yields (US10Y) have spiked up, and housing recovery is predicated on mortgage rates falling.
Likely beneficiaries: (NASDAQ:UPBD), (PRG): The company behind Rent-A-Center and the fintech platforms operator may see a less aggressive Consumer Financial Protection Bureau.
(NYSE:ETD), (NYSE:LZB): Ethan Allen Interiors and La-Z-Boy have North American manufacturing, which could insulate their business relative to others.
Investors interested in healthcare ETFs, here are a few: (XLV), (IHI), (FHLC), and (VHT).
A few retail and e-commerce ETFs: (XRT), (IBUY), (ONLN), and (ISHP).