12 Major US Companies Losing the Most on China Trade War Fallout

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Ralph Lauren Corp. (NYSE: RL) was taking it on the chin worse than Nike, with its plans from late 2018 including one store per week opening up in China. Ralph Lauren’s clothing coming into the United States also may face tariffs, with its latest annual report signaling that one-third of Ralph Lauren’s products are sourced from China. The company’s 10-K from May 2018 showed that the company has a third-party-owned distribution facility in Tuen Mun, Hong Kong, for its Southeast Asian (and Greater China) sales. That 10-K also showed a special “Import Restrictions and Other Government Regulations” that named China directly. Ralph Lauren shares were down 4.8% at $118.31, and this was a $131 stock just 10 days earlier.

Starbucks Corp. (NASDAQ: SBUX) still has lots of growth to see from China, even if there may be as many opportunities elsewhere in the globe on a cumulative basis. It has opened nearly 3,800 stores in China and had plans to double that number over the next four years. Its shares were down 2.4% at $76.52 on Monday.

Tiffany & Co. (NYSE: TIF) has started to feel like more of a proxy for the luxury market among Chinese spenders wanting to show their status. Back in late March, CEO Alessandro Bogliolo touted the company’s domestic business in China as an offset to weaker U.S. sales to Chinese tourists. While sales in China were said to be growing nicely and strongly, how likely is that to last if China is against American brands. Its shares traded down 5.3% at $99.29.

United States Steel Corp. (NYSE: X) is no longer even close to being the largest steelmaker, but it takes steel to build just about anything from structures and buildings to most durable goods. And with “United States” in its name, a China retaliation might come with extra pushback. China’s steel industry also might be happy to undercut U.S. Steel and its U.S. competitors in other international dealings in which it competes. Shares of U.S. Steel traded down 6.6% at $14.62 on Monday.

Wynn Resorts Ltd. (NASDAQ: WYNN) owns and operates one of Chinese Macau’s biggest resorts, and Macau is frequently targeted by Mainland China. Its shares also had rallied in 2019 on the hopes of a China trade resolution making it more palatable for Chinese gamblers to gamble in a casino that is a dominant U.S. company by name. Wynn’s stock traded down 4.7% to $140.50 a week earlier, but Monday’s reaction was even worse, with a 6.7% drop to $121.15.

Yum China Holdings Inc. (NYSE: YUMC) was spun out by Yum! Brands Inc. (NYSE: YUM) and it is entirely a China-focused play. If the Chinese citizenry feels bad about America, or if it is encouraged to avoid buying American brands, the good old KFC owner in China will feel the heat. Yum China was down almost 5% at $42.67 on Monday. Yum Brands collects a royalty payment from Yum China now, but its shares were only down 1.5% at $99.87 as the company has become a non-China player for the most part.

You have probably noticed that this list only showed Apple in technology. As far as China is concerned, we consider Apple more of a premium brand more than being the China-dominant technology company. Intel is down less than 3% on the day and they have close to one-fourth of their sales coming from China (and Intel’s shares have lost close to 11% since trade war fears were rekindled). Cisco Systems has also been making more inroads into China, with a 4% drop on Monday that was more like a 6% drop from a week ago. In the additional technology names, the DRAM, flash and ‘other’ memory within semiconductors all have a lot to lose if retaliation upon retaliation occurs — Texas Instruments, NVIDIA, Skyworks, Micron, and just about any other chip and related company you can think of might have something to lose if their chips and products are owned by an American company and those goods are not manufactured in Mainland China or its related economic zones.

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