Elon Musk’s Tesla and 18 other stocks can soar if Trump wins — but investors in these 19 companies should be cheering for Harris
Former President Donald Trump and Vice President Kamala Harris are in a tight battle.
In just over a month and a half, the US will have a new president elect. Either Donald Trump will take back the Oval Office, or Vice President Kamala Harris will get the promotion of a lifetime.
This week’s feisty debate between the Republican and Democratic nominees has captured the nation’s attention, and market strategists are no exception.
While many investment firms stay away from politics, others aren’t shy about talking about the election’s possible implications. Throughout 2024, B-17 has rounded up ideas about the intersection of the election and markets from firms like Bernstein, Goldman Sachs, and Barclays, plus investing legends like Steve Eisman.
For all the differences between Trump and Harris, some have noted that both of their parties have a populist streak, and neither seems overly concerned with the burgeoning national debt.
“Economic populism is intrinsic to both candidates’ policy platforms but directed at different segments of society,” wrote Solita Marcelli, the chief investment officer, Americas, at UBS Global Wealth Management, in a September 12 note. “Trump prefers to focus on lower income taxes and trade protectionism. Harris emphasizes higher taxes targeted at the affluent and incentives for entrepreneurs. Neither is spending much time discussing recurring federal budget deficits.”
Despite those apparent similarities, Republicans and Democrats generally have starkly different policy proposals that could have major implications for certain sectors and industries.
How to invest based on this fall’s elections
To that point, Oppenheimer strategists published a note that listed 38 stocks that would thrive if one party wins the White House and Congress. In the spirit of fairness, they had 19 firms for each outcome. The team also shared seven stocks that can hold up no matter what happens.
Their analysis is based on whether Republican or Democratic policies are more conducive to a stock’s success. The strategists noted that there aren’t necessarily the firm’s top ideas, nor are they merely a list of outperform-rated companies.
“This playbook is intended to help investors navigate trading dynamics around the elections,” Oppenheimer strategists wrote in the note. “Over the longer term, we expect stocks’ behavior will more likely be a function of broader market/industry-level trends and individual company performance.”
Below are those 38 ideas, sorted in alphabetical order by their sector and industry. In each of the 17 groups is its top election issue, according to Oppenheimer, plus the company or companies that would do best under Republican or Democratic control. Note that Oppenheimer didn’t give picks for a divided government scenario.
Consumer Growth & Ecommerce
Sector: Consumer
Top election issue: “We envision a number of potential implications for our Consumer Growth & ecommerce coverage, including: shifts in underlying consumer sentiment, tariffs, and changes in US. tax policy. In our view, in the event of a Republican sweep, while not easily measured, sentiment among rural American consumers should improve, owing in part to more favorable domestic drilling policies and stimulating effects of potentially lower personal income taxes, particularly amongst higher income consumers. Should the Democratic party gain control of the Federal Government in November, we anticipate fewer and less severe than currently expected tariff policies, and greater direct fiscal support for lower-and-middle income households, which should represent a key positive for retailers within our coverage, including those more exposed to imports and lower income cohorts.”
What to buy if Republicans sweep: Tractor Supply (TSCO)
What to buy if Democrats sweep: Five Below (FIVE)
Insurance: Property & Casualty
Sector: Financials
Top election issue: “Rising costs, mainly due to social inflation, have hit insurance margins and resulted in significant pricing increases. Most liability coverages are running loss inflation in the 10% range, as litigation volumes and average jury awards continue to weaken commercial insurance margins. The ability to raise prices is critical to keep up with loss trend. Jurisdictions identified by the American Tort Reform Association as problematic in terms of potential runaway jury awards are primarily in Democrat controlled jurisdictions (CA, NYC, Chicago, and St. Louis). Several Republican states (most notably, FL) have taken steps to clean up excessive litigation. For insurers, tort reform is a mixed bag. Reduced social inflation pressures would improve near-term margins, but reduce ability to achieve pricing increases. Such increases have driven strong growth in recent years and margin expansion.”
What to buy if Republicans sweep: Progressive (PGR)
What to buy if Democrats sweep: Kinsale Capital Group (KNSL), Skyward Specialty Insurance Group (SKWD)
Merchant Banking/Private Equity
Sector: Financials
Top election issue: “For all the polarization, both parties are basically united in wanting to restrict trade with China and immigration. On balance, we think this is good for jobs and bad for inflation, and thus we are in the ‘higher for longer’ camp, but there isn’t really a difference between the two parties. In addition, we think both parties have a bunch of proposals that will never see the light of day, even in the event of a ‘sweep.’ Thus, we would focus on two relatively narrow issues where the party in power will actually make a difference — antitrust policy and climate change.”
What to buy if Republicans sweep: Goldman Sachs (GS)
What to buy if Democrats sweep: KKR & Co. (KKR)
Biotechnology
Sector: Healthcare
Top election issue: “The next administration and the 119th Congress have the potential to shape the future of the Affordable Care Act (ACA), Medicare (including the new Medicare drug price negotiation program) and Medicaid. All of these could have a material impact on the biotechnology sector. Pharmacy benefit manager (PBM) reform is also a possibility and could have a derivative impact. Importantly, neither side has yet to propose significant changes to the American health care system as we’ve seen in past elections — such as replacing the Affordable Care Act or implementing a ‘Medicare for All’ single-payer framework.”
What to buy if Republicans sweep: Amgen (AMGN)
What to buy if Democrats sweep: N/A
Healthcare Services
Sector: Healthcare
Top election issue: “The most prominent issue impacting healthcare is how the government allocates funding to entitlement programs, like Medicare and Medicaid. For example, Republicans typically call for lower government spending on Medicaid and Marketplace programs, instead choosing privatized forms of delivery, including Medicare Advantage. Meanwhile, Democrats typically want more breadth and depth of coverage from these programs. While there are many ways in which the two parties can promote their agenda, we believe the enhanced Advanced Premium Tax Credits (eAPTCs) are most under the microscope right now. Due in large part to these credits, Marketplace enrollment has nearly doubled under this administration to more than 21M people. These credits are set to expire at the end of 2025, and could be extended with Democratic control. Even in the case of gridlock, the credits could be extended as part of a deal with Republicans to extend the Trump tax cuts.”
What to buy if Republicans sweep: Humana (HUM)
What to buy if Democrats sweep: Centene (CNC)
Medtech
Sector: Healthcare
Top election issue: “In medical devices, there are no major sector-specific issues at play for the upcoming election. That said, three hot button topics that will impact our stocks in various ways, particularly on the large-cap side, are tax policy, tariffs, and increased scrutiny of drug prices (the latter being a pharma/biotech issue, but MedTech has seen positive money flow when those sectors have faced risk previously). As it relates to tariffs, the primary risk we focus on is the potential for retaliatory tariffs by other countries and the impact that would have on US exports. To be sure, China growth has waned in recent years. Yet China remains a key opportunity for large-cap MedTech expansion, and policies that might dampen the ability to sell into China (or other countries that might retaliate) would impact the sales growth outlook.”
What to buy if Republicans sweep: DexCom (DXCM)
What to buy if Democrats sweep: Alcon (ALC)
Homebuilders
Sector: Industrials
Top election issue: “Within homebuilding, the top election issue pertains to housing affordability. Democrats are pushing for first-time homebuyers’ tax incentives and the construction of an additional 3 million homes. The main issue for building products relates to the potential reinstatement of tariffs from China of up to 60%. These tariffs would raise prices on building products companies who source supplies from China, potentially impacting margin.”
What to buy if Republicans sweep: Masco (MAS)
What to buy if Democrats sweep: DR Horton (DHI)
Industrial & Business Services
Sector: Industrials
Top election issue: “Due to our diverse coverage, various election issues may impact our covered companies. Our transportation & logistics, rental, and facility services coverage subsectors are levered to a reinvigoration of the US economy. Changes and increased complexity to the US tax code would be relevant to our tax services coverage.”
What to buy if Republicans sweep: XPO Inc. (XPO)
What to buy if Democrats sweep: Target Hospitality (TH)
Industrial Machinery & Flow Control
Sector: Industrials
Top election issue: “In our view, the biggest swing factor regarding the elections (primarily impacting IMFCWater coverage) is climate and environmental policy. As detailed on a recent expert call on the topic, the level of Federal support for the water sector and near-term trajectory of project spending (particularly on PFAS (per- and polyfluoroalkyl substances) remediation and lead service-line replacement) may be notably weaker under Republican control. With regard to US industrials broadly, we anticipate reaccelerating activity during 2025 following somewhat of a pre-election ‘air pocket,’ with both Harris and Trump championing policy that incents continued reshoring and US manufacturing investment. While this reset naturally benefits spending on water equipment and technologies (all else equal), the near-term bull case for sector spending is less compelling under Trump 2.0 and/or a Republican Congress.”
What to buy if Republicans sweep: Carlisle Companies (CSL)
What to buy if Democrats sweep: Xylem (XYL)
Industrial Multi-Industry
Sector: Industrials
Top election issue: “There is a pull between high regulation and subsidies to spur and direct investment to targeted sectors vs. a push with deregulation enabling private sector capital and a more dynamic economy for a broader spectrum of multi-industry and electrical equipment (MIEE) companies.”
What to buy if Republicans sweep: Regal Rexnord (RRX)
What to buy if Democrats sweep: Eaton (ETN)
Sustainable Growth & Resource Optimization
Sector: Industrials
Top election issue: “Ongoing implementation and preservation of benefits from the Inflation Reduction Act (IRA). The IRA was a transformative piece of legislation that has already produced an immediate, quantifiable EPS benefit to stocks in our coverage while galvanizing significant investment in U.S. manufacturing and jobs. Multiple industries continue to await guidance on tax incentives along with disbursement of funds appropriated under the IRA. … We believe trade policy is the leading election issue impacting our Ag and Construction coverage. On its face, a Republican sweep would be viewed as largely beneficial across the majority of our names, as pillars of economic, infrastructure, and energy policy tend to benefit industrial end-markets. However, we see a protectionist trade platform presenting longer-developing risks under a Republican sweep scenario. We believe tariffs and the potential for retaliation, specifically from China, one of the US’s largest agriculture trade partners, have the potential to exacerbate existing uncertainty in the ag economy. The impact of a Democratic sweep is not the mirror opposite of a Republic sweep. Indeed, both the IIJA and IRA have been favorable for our infrastructure coverage, and we believe IRA tax credits for clean fuels and sustainable aviation fuel (SAF) have the potential to be a welcome source of domestic agricultural feedstock demand.”
What to buy if Republicans sweep: Caterpillar (CAT), Republic Services (RSG), Tesla (TSLA)
What to buy if Democrats sweep: Ameresco (AMRC), Green Plains (GPRE), Sunrun (RUN)
Analytics, Data, Security and Infrastructure Software
Sector: Technology
Top election issue: “We believe there are no major election issues that significantly impact our analytics, data, security, and infrastructure software coverage directly. On the margin, a Democratic win would signal a likely continuation of existing policies of hardening the security posture of government agencies (Biden’s Executive Order on improving the nation’s cybersecurity). More restrictive legislation around data privacy (catching up to Europe) and higher scrutiny of M&A activity by antitrust regulators are also possible. We believe that a Republican win would likely be more relaxed on the aforementioned topics.”
What to buy if Republicans sweep: Cisco Systems (CSCO)
What to buy if Democrats sweep: Zscaler (ZS)
Cloud & Communications
Sector: Technology
Top election issue: “The top election issues facing our coverage are corporate taxes, national spectrum pipeline, regulation, and investment in infrastructure. Many of our large-cap names, primarily in the telecom space, are significant cash-tax payers. Their free cash flow is most exposed to changes to tax legislation, expected to be reduced to 15% under the Republican platform or increased to 28% under the Democrats. Positively, there has been demonstrable bipartisan support for a national spectrum pipeline and strategy. However, the Republicans favor dedicating new spectrum to licensed use while the Democrats prefer unlicensed/shared use. Last, we see less regulation as positive for the carriers, and to a less extent, Cloud and AI, but negative for cable.”
What to buy if Republicans sweep: AT&T (T)
What to buy if Democrats sweep: Comcast (CMCSA)
Emerging Technology & Services
Sector: Technology
Top election issue: “Differences in tech policy between the two parties’ platforms will likely have the most impact on our coverage. Key issues on AI safety and regulation of large online platforms may meaningfully shift market share and competitive dynamics between the incumbents and emerging competitors.”
What to buy if Republicans sweep: Apple (AAPL)
What to buy if Democrats sweep: Applovin (APP)
Internet
Sector: Technology
Top election issue: “The top election issue is regulation. Within advertising, the DOJ has filed multiple lawsuits against GOOG, and a judge recently ruled that the company operates an illegal monopoly within search. Within marketplaces, UBER operates within a fragmented and complicated regulatory environment, as each US state largely sets its own laws regarding workers’ compensation. Besides regulation, taxes are another important election issue, as higher corporate taxes could weigh on advertising and cloud spending.”
What to buy if Republicans sweep: Alphabet (GOOG)
What to buy if Democrats sweep: Snap (SNAP)
SaaS/Applications Software
Sector: Technology
Top election issue: “Individual software companies generally are not as heavily influenced by politics as other sectors. Historically, government policy and regulations (R&D tax credit, H1B visa quotas, M&A scrutiny) typically impact the group as a whole. We see tax policies and the prioritization of specific end markets (aerospace & defense spending, small-business formation) as areas that could prove marginally favorable for certain companies.”
What to buy if Republicans sweep: HubSpot (HUBS)
What to buy if Democrats sweep: Altair Engineering (ALTR)
Special Situations
Sector: N/A
Top election issue: “We believe climate/energy and infrastructure policy are key areas of focus among our industrial-related names. On the climate and energy side, the Inflation Reduction Act (IRA) incentivizes investments in clean energy (e.g., wind) through production tax credits (PTCs). Democrats have generally vowed to protect the IRA and investments in clean energy, while Republicans are focused on prioritizing energy independence through increase fossil fuel production and rolling back environment regulations. We see infrastructure investments being supported by both parties.”
What to buy if Republicans sweep: Allison Transmission Holdings (ALSN)
What to buy if Democrats sweep: Arcosa (ACA)
