- The US presidential campaign is under the spotlight for market participants.
- The odds of a Trump victory have increased further following his latest debate with Biden.
- In this article, we will take a look at stocks that would benefit most if Trump wins.
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The recent presidential debate has bolstered Donald Trump's lead over Joe Biden, boosting the likelihood of the former reclaiming the presidency with just four months to go until the US presidential elections.
This has sparked intense speculation about which stocks stand to gain the most from a Trump victory.
Economists and traders widely anticipate that a Trump administration would prioritize deregulation, tax cuts, bolstered domestic energy production, and a tougher stance on trade, potentially leaning towards protectionism.
Industries expected to thrive under such policies include oil companies, healthcare firms, and automakers, which are seen as beneficiaries of reduced regulatory burdens and favorable trade conditions.
Moreover, Trump's notable pro-cryptocurrency stance contrasts sharply with Biden's regulatory approach, potentially shaping a positive landscape for the crypto sector, particularly stocks like Coinbase (NASDAQ:COIN).
Adding to the intrigue, Trump's Trump Media (NASDAQ:DJT), the parent company of his media platform Truth Social, could also benefit from a potential Trump victory.
In this analysis, we will explore three stocks poised to potentially benefit from a Trump presidency: Trump Media, Coinbase, and First Solar Inc (NASDAQ:FSLR), which could gain from heightened tariffs under Trump's trade policy.
1. Trump Media and Technology Group
Trump Media & Technology Group, the company that runs Trump's social network, Truth Social, could be one of the biggest beneficiaries of a victory for the former US president, irrespective of any economic or financial considerations.
Indeed, it's a safe bet that many entities will invest in the company with the aim of currying favor with Trump, should he become President of the United States once again.
However, it should be noted that this is a stock that falls into the category of theme stocks, whose value depends on speculation and FOMO more than financial logic.
Thus, although Trump Media has seen its value more than halved from its record high at the end of March, valuation models still regard the stock as vastly overvalued, with an InvestingPro Fair Value that stands more than 40% below the current price.
Source: InvestingPro
It should also be noted that no professional analyst is currently officially following the stock and that its financial health is considered weak according to InvestingPro criteria.
2. Coinbase Global
Donald Trump has made numerous pro-cryptocurrency statements during his campaign, even claiming at a private gala that he wants to become the "President of Cryptocurrencies".
Therefore, shares of Coinbase could also benefit greatly from a Trump victory, in the hope of regulations that are more favorable to the industry's development.
For the time being, however, the stock appears to be overvalued about its financial flows, with an InvestingPro Fair Value of $148.47, i.e. 34% below the current price.
Source: InvestingPro
On the other hand, analysts estimate that the stock could rise by a further 14%.
3. First Solar
Trump is better known as a supporter of the oil industry than of renewable energies, but it's no less true that solar panel manufacturer First Solar, which is suffering from Chinese competition, could benefit from a rise in protectionism, making Chinese products less competitive.
Note that the stock fell by 30% between its June 12 record of $306.77 and Tuesday's low and posted a powerful rebound of 6.64% on Wednesday.
Now, InvestingPro's Fair Value suggests that the rebound could be even stronger, settling at $285.48, or 23.5% above Wednesday's closing price.
Source: InvestingPro
Analysts also have a similar target of $283.56, which translates into a 22.7% upside potential.
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Disclaimer: This article is written for informational purposes only; it does not constitute a solicitation, offer, advice, counsel or recommendation to invest as such it is not intended to incentivize the purchase of assets in any way. I would like to remind you that any type of asset, is evaluated from multiple perspectives and is highly risky and therefore, any investment decision and the associated risk remains with the investor.