Northrop Grumman Corp. (NYSE: NOC) is among the world’s largest and most dominant defense contractors. The company does most of its business with the U.S. government (Department of Defense and intelligence units, 85% of total 2017 sales) and also with foreign, state and local governments and with commercial customers. While any defense firm has ultimate exposure to China, the company may be a winner if escalations heated up further arms races (against Russia and China) and it should have little to no real revenues originating from China to speak of. Northrop Grumman’s market cap was $45 billion, and it was expected to have $30 billion in 2018 sales.
Sirius XM Holdings Inc. (NASDAQ: SIRI) has become a more complex structure in recent years under Liberty, and its business model may be changing strides after its acquisition of Pandora. That said, its operations are almost entirely in North America for the time being. The company was punished after weaker guidance in 2019 growth expectations, but this had nothing to do with China. Its market cap is $26 billion, and the company’s standalone revenues were projected to be around $5.75 billion in 2018.
Southwest Airlines Co. (NYSE: LUV) may have expanded its discounted operations to Mexico and the Caribbean in recent years, and the airline might have more growth ambitions in the years ahead, but this is still considered to be a domestic air carrier and is among the best run in the industry. Southwest has a market cap of $27 billion that dominates U.S. and international air carriers alike.
UnitedHealth Group Inc. (NYSE: UNH) generally is considered to be the largest U.S. health insurance provider, covering tens of millions of Americans with health and ancillary insurance products. It may have companies as clients who do business in China and its clients may even have offices in China, but only three of its hundreds of subsidiaries are in China, and its annual report noted that any of the endless amounts of subsidiaries would be constituted as a significant subsidiary. UnitedHealth listed six subsidiaries in India, and its Asian exposure serves more than a million people in India but exponentially larger numbers in the United States, the United Kingdom and Brazil. Its market cap was almost $240 billion.
Valero Energy Corp. (NYSE: VLO) is a top refiner with related activities in the United States and a few international places, but no direct exposure to China for its operations as a whole. In the 2017 annual report, Valero did include “Asia,” along with the other continents and regions outside of North America, but its ability to get crude oil to refine should not face any serious disruptions based on China’s economy. Where its refined products end up is based on contracts and on international markets, and the end products are in large fungible global markets. Valero’s market cap was $33 billion.
Verizon Communications Inc. (NYSE: VZ) is one of the few Dow Jones industrial stocks that can claim to have little to no worries about how things are going in China’s economy. There may be some underlying risks with technology suppliers if the tariff issues are not resolved, but many companies have been reworking efforts to avoid those tariffs in the years ahead, if tariffs become a large issue again. Verizon now owns AOL and Yahoo under its Oath platform, but these are rather small in the overall picture and the exposure to Chinese economic growth is believed to be very little. Verizon’s market cap was almost $240 billion in mid-January, and it was expected to have posted close to $131 billion in annual sales in 2018.