5 Stocks for 2018 That Could See Huge Earnings Growth From Tax Cuts

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General Motors

This domestic car company could continue to benefit from the flooding and damage this past summer. General Motors Co. (NYSE: GM) designs, builds and sells cars, trucks, crossovers, and automobile parts worldwide. The company operates through GM North America, GM Europe, GM International Operations, GM South America and GM Financial segments. It markets its vehicles primarily under the Buick, Cadillac, Chevrolet, GMC, Holden, Baojun, Jiefang and Wuling brand names.

The company also sells cars, trucks and crossovers to dealers for consumer retail sales, as well as to fleet customers, including daily rental car companies, commercial fleet customers, leasing companies and governments. In addition, it offers connected safety, security and mobility solutions, and information technology services. The company, through its subsidiary, General Motors Financial Company, provides automotive financing services.

Shareholders receive a 3.53% dividend. The $52 Deutsche Bank price target compares with the consensus target of $47.21. The shares recently traded $43.00.

Lockheed Martin

This is a top aerospace and defense stock to buy, and many on Wall Street are expecting a very solid continuation of U.S. and foreign defense spending. Lockheed Martin Corp. (NYSE: LMT) researches, designs, develops, manufactures, integrates, operates and sustains advanced technology systems, products and services. It also provides a wide range of defense electronics products and IT services.

Being the Pentagon’s prime contractor, Lockheed Martin offers a diverse portfolio of global aerospace, defense, security and advanced technologies. Its leveraged presence in the Army, Air Force, Navy and IT programs guarantees a steady inflow of follow-on orders, not only from the U.S. government but also from many foreign allies of the nation.

While the company reported third-quarter earnings below the consensus and Merrill Lynch estimates, it raised its 2017 earnings outlook. New revenue recognition will reduce 2017 net sales by approximately 2% from current guidance. The analysts are very positive on the free cash flow and record backlog at the company.

Investors are paid a 2.55% dividend. The Deutsche Bank price objective is $340. The consensus target is $328.85, and the shares were last seen at $313.05.

Micron Technology

Micron Technology Inc. (NASDAQ: MU) is a global leader in advanced semiconductor systems. Its broad portfolio of high-performance memory technologies, including DRAM, NAND and NOR flash, is the basis for solid state drives, modules, multichip packages and other system solutions. Its memory chip solutions enable the world’s most innovative computing, consumer, enterprise storage, networking, mobile, embedded and automotive applications.

Micron and Intel announced last year the availability of their 3D NAND technology, the world’s highest-density flash memory. Flash is the storage technology used inside the lightest laptops, fastest data centers and nearly every cell phone, tablet and mobile device.

The company recently announced a massive secondary offering that will be used to retire a stunning $2.25 billion in outstanding debt. While clearly the added shares will present dilution, the elimination of the debt service equals up the score for the company on the balance sheet. The chip maker said it will redeem all $1.25 billion of its outstanding 7.5% notes due 2023, as well as $1 billion of 5.25% notes due 2023.

Deutsche Bank has set its price target at $55. The posted consensus target is $53.64. Shares traded at $41.10.

Five top companies that could be big winners if the tax reform package is passed. While the plans from Congress and the Senate are somewhat different, they don’t appear to be so drastically apart on the specifics that they can’t come to an agreement. After almost 20 years of sub-standard growth, this could be a game changer for the country.