10 Winning Stock Themes in a McCain Administration

This is the second part in the four-part series of potential winning and losing themes under either Obama or McCain administrations. In today's edition I will be looking at ten potentially winning themes if McCain is elected the next President. For the purpose of this exercise, I will assume the likely scenario under a McCain administration of a majority Democratic Congress.

10 Potentially Winning Stock Themes of a McCain administration:

1) Nuclear/Uranium Companies- McCain would like to move the country to allow for increased use of nuclear power for energy and has set out a goal of building 45 nuclear energy plants by 2030. I would point to offshore drilling as potentially occurring, however, this is unlikely with a democratic Congress.

2) Defense- The war in Iraq and Afghanistan as well as continued strong Government funding for defense projects are more likely to continue under an McCain presidency thus helping the largest defense contractors as well as smaller defense companies. However, it's very possible that McCain may re-shuffle some of the current initiatives.

3) The baby bells- There is an increased likelihood of reform to the industry with a McCain victory. In addition, it is unlikely that net neutrality would pass under McCain thus helping the bells (and potentially hurting some internet companies).

4) High dividend stocks- It is much less likely under McCain that the dividend taxation rate would be changed from the current levels. At the same time, capital gains and income taxes are less likely to be increased, thus supporting higher dividend paying stocks.

5) Managed care (HMOs)- McCain proposes additional tax credits for families to fund and find their own health care and there would be little risk for any form of nationalism under his administration.

6) Asset management firms- Continued low capital gains rates, income tax rates and growth of savings accounts should all help asset management firms under an McCain administration.

7) Continuation of the globalization trade- McCain is more likely to continue the free trade agreements already in place and potentially add additional ones with countries such as Colombia. This would help many multinational companies as well as some companies which are currently conducting significant business in Latin America, Asia and other areas.

8) High-end retailers- Under a McCain administration taxes are more likely to remain at the lower levels under Bush (and potentially lower with a change in Congress). This would be of greatest benefit to higher-end retailers.

9) Public hedge fund companies- At the very least the public hedge fund companies would do much better under McCain than Obama as there would be much less risk of further regulation in the industry.

10) Financial sector- There is likely to be much less regulation under McCain than Obama, however, I think everyone should expect more regulation than what we see today no matter who wins.

Comments

[morgan77]

Right on with number 10!

[Scared Stiff]

I think trying to foretell what either of these guys will actually do when in office is a loser's game. How do you feel so confident in what he's going to do when he's drastically changed his position on virtually every issue since his 2000 campaign? The only one that's a no-brainer is defense contractors, and I doubt Obama will have the courage to clean up the $billions of waste going to that sector, so it's a winner either way, IMO.