The good news for all of us is that in about seven weeks the political cycle will be over, at least as far as the presidential election is concerned, and we can concentrate more on other fall activities. While the polls have the race pretty tight, one thing is for sure: a victory by Donald Trump would favor a far different group of stocks than a victory by Hillary Clinton.
A new Deutsche Bank research report makes the case that certain outcomes of the election could ratchet up the volatility big-time. For years Wall Street has always seemed to be happiest when power was split to some degree, and there was an element of gridlock. Either way, if Trump is the winner, certain sectors should do better than others and vice versa.
The Deutsche Bank team has a 15 stock basket for a Trump victory, but we picked five that we think may do okay either way, and they all pay dividends.
This is a broadcasting-related stock that could have big upside potential. Comcast Corp. (NYSE: CMCSA) is one of the nation’s largest video, high-speed internet and phone provider to residential customers under the XFINITY brand and also provides these services to businesses. Comcast has invested in technology to build an advanced network that delivers among the fastest broadband speeds and brings customers personalized video, communications and home management offerings.
Comcast has consistently been growing earnings substantially with extremely strong content revenue growth. Increased revenue at NBC Universal is also giving the company some earnings tailwinds, and a growing sports lineup is adding to revenues.
Some top Wall Street analysts see cable giants like Comcast as a top growth story that still has plenty of room to run, as well as generating solid earnings to support continued stock buybacks.
Comcast investors receive a 1.67% dividend. The Wall Street consensus price objective is $75.37. Comcast closed trading on Monday at $65.83.
This large cap leader makes sense in all markets. Dow Chemical Co. (NYSE: DOW) is a market-driven integrated, with an industry-leading portfolio of specialty chemical, advanced materials, agrosciences and plastics businesses. It delivers a broad range of technology-based products and solutions to customers in approximately 180 countries and in high-growth sectors such as packaging, electronics, water, coatings and agriculture.
With an improving economy domestically, and emerging markets bottoming, the growth potential for a company like Dow Chemical with multiple revenues and product silos is outstanding. Last year, Dow had annual sales of more than $58 billion and employed approximately 53,000 people worldwide.
Last December the company announced a huge merger with DuPont. It is planning to combine into a company valued at about $120 billion, which will then split off into three separate companies, one focused on materials, one on agriculture and one on nutrition and electronics specialty products. Many on Wall Street think that the merger offers a very solid investment for the future, and the sum-of-the-parts total may be far greater than the current value of the stock.
Investors receive an outstanding 3.53% dividend. The consensus price target is $60.25. The stock closed Monday at $53.06.