3 Must-Own Stocks For A Hillary Clinton Presidency

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Includes: ARCC, CAT, SUNEQ
by: Manny Backus

It looks like the U.S. presidential race will soon be narrowed to just two candidates. All the blustery rhetoric, posturing, and challenges are finally coming to an end. Provided no surprises, right now, it appears that the final election will consist of Hillary Clinton vs. Donald Trump.

I never remember this much passion and energy in a presidential election. The electorate are truly on fire, and it's a great thing to see! We already wrote about what to expect should Donald Trump become our next president.

This article will explore what to expect should Hillary Clinton win the election and provide three stocks that should thrive under her leadership.

The Facts

Believe it or not, history has proven that the stock market performs better under a democratic presidential administration than a Republican one.

According to the Stock Trader's Almanac, since World War II, the stock market has gained an average of 11.2% under democratic regimes and 6.3% under the Republicans. This was very surprising to me provided the pro-business rhetoric of the Republicans, but investors should not ignore the facts!

Let's take a closer look at Hillary's economic platform before we explore the individual stocks that should prosper under her leadership.

Here are 11 things Hillary Clinton plans to do if elected President of the United States.

1. Provide tax relief for families

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Hillary will cut taxes for hard-working families to increase their take-home pay as they face rising costs from child care, healthcare, and sending their kids to college. She is calling for extending a tax cut of up to $2,500 per student to help deal with college costs as part of her New College Compact, and for cutting taxes for businesses that share profits with their employees.

2. Unleash small business growth

Hillary's father owned a small business - and she understands that small businesses are the backbone of jobs and growth in America. She has put forward a small-business agenda to expand access to capital, provide tax relief, cut red tape, and help small businesses bring their goods to new markets.

3. Create a New College Compact

Hillary's New College Compact will invest $350 billion so that students do not have to borrow to pay tuition at a public college in their state. Her plan will also significantly cut interest rates on student loans and enable an estimated 25 million Americans with student debt to refinance at today's lower rates, saving the typical borrower $2,000 over the life of their loans.

4. Boost public investment in infrastructure and scientific research

One of the best ways to drive jobs and improve our nation's competitiveness is to invest in infrastructure and scientific research. Hillary has called for a national infrastructure bank that would leverage public and private funds to invest in projects across the country. She will call for reform that closes corporate tax loopholes and drives investment here, in the U.S. And she would increase funding for scientific research at agencies like the National Institutes of Health and the National Science Foundation. Finally, Hillary is a big believer in alternative energy and will work to make it more mainstream

5. Lift up participation in the workforce - especially for women.

For too long, issues like equal pay, paid leave, and affordable child care have been put off to the side as "women's issues." Hillary believes they are crucial to our competitiveness and growth - and to lifting incomes for working families.

6. Fair growth

Inequality is a drag on our economy, and to get incomes rising again, we need to renew our country's basic bargain. With near-record corporate profits and stagnant wages, the deck is stacked against working Americans. If you work hard, you deserve to get ahead and stay ahead.

7. Ensure more workers share in near-record corporate profits

Corporate profits are near record highs - but workers have not shared through rising wages. Profit sharing is linked to higher pay, benefits, and productivity. That's why Hillary's plan creates a 15 percent tax credit for companies that share profits with workers on top of wages and pay increases.

8. Raising the minimum wage and strengthening overtime rules

She believes we are long overdue in raising the minimum wage. She has supported raising the federal minimum wage to $12, and believes that we should go further than the federal minimum through state and local efforts, and workers organizing and bargaining for higher wages, such as the Fight for 15 and recent efforts in Los Angeles and New York to raise their minimum wage to $15. She also supports the Obama administration's expansion of overtime rules to millions more workers.

9. Reform our tax code so the wealthiest pay their fair share

Hillary supports ending the "carried interest" loophole, enacting the "Buffett Rule" that ensures no millionaire pays a lower effective tax rate than their secretary, and closing tax loopholes and expenditures that benefit the wealthiest taxpayers to pay for her plan to make college affordable and refinance student debt.

10. Put an end to "quarterly capitalism"

We need an economy where companies plan for the long run and invest in their workers through increased wages and better training - leading to higher productivity, better service, and larger profits. Hillary will revamp the capital gains tax to reward farsighted investments that create jobs. She'll address the rising influence of the kinds of so-called "activist" shareholders that focus on short-term profits at the expense of long-term growth, and she'll reform executive compensation to better align the interests of executives with long-term value.

11. Impose accountability on Wall Street

Nowhere will the shift from short-term to long-term thinking be more important than on Wall Street. Hillary will defend the Wall Street reforms put in place after the financial crisis - and she'll go further. She'll tackle dangerous risks in the financial sector, and she'll appoint and empower tough, independent regulators and prosecute individuals and firms when they commit fraud or other criminal wrongdoing.

Let's break down Hillary's plan into three stock market-centric themes and focus on a stock for each of these themes.

1. Infrastructure Improvement

This has been a primary talking point of the Clinton campaign. She plans on launching the largest infrastructure improvement project ever in the United States. This will help rebuild bridges, highways, dams, and a host of other crucial but seldom thought about pieces of the United States infrastructure. She plans on launching a bank dedicated to funding these projects. Not only will this plan make much needed improvements in our aging infrastructure, but also it will likely create massive jobs.

The heavy machinery sector should get a strong shot in the arm from this initiative. Our stock of choice for this Clinton theme is Caterpillar (NYSE:CAT).

2. Small Business Focus

Hillary has stressed again and again how she plans on making things easier for small business. The one thing that is crucial for small business success is access to capital. Business development companies, or BDCs, help fill this need today, and their demand should only increase as Clinton's policies stroke the small business fire. Our favorite company for this theme is the BDC Ares Capital (NASDAQ:ARCC).

3. Alternative Energy

The Democrats have long been focused on alternative energy. At the same time, Republicans are generally fossil or traditional fuel oriented. We can definitely expect growth in the alternative energy sector should Hillary become the next president. We like SunEdison (SUNE) to best profit from this theme.