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Most Trump voters believe he will boost their economic security and for many, the ability to support their families is a top concern. Appealing to people’s most basic needs such as their personal finances has clearly been a winning strategy, and if the results can be delivered, Trump will likely remain popular with those who voted for him.
Although it is early days, and we can’t know exactly what policies will be passed by Trump, it is likely that we will see some sort of tax cuts for corporations and individuals as well as an easing of business regulations. These were strategies he implemented in his previous term with notable impact, and he’s likely to apply them again.
What this means is that the average American citizen is going to have a few extra dollars in their pocket at the end of every month. That money will either get invested into the stock market or get spent on discretionary purchases. Two of the market’s leading consumer discretionary businesses are Amazon ((AMZN - Free Report) ) and Home Depot ((HD - Free Report) ), and not only are they set to benefit from this new theme, but they also boast top Zacks Ranks and strong growth forecasts.
Image Source: Zacks Investment Research
Amazon: The Leading E-Commerce Stock
Even before realizing the business implications of a Trump presidency, Amazon was among my favorite stocks in the market. But with this additional catalyst of a strong consumer, it goes straight to the top of my must own stock list.
After spending the past few months trading mostly sideways since spring, AMZN shares have soared to new all-time highs in response to the election results, breaking out of their recent stagnation. And not only can Amazon expect growth from consumer spending, but its cloud services business is an absolute juggernaut, spewing cash thanks to the AI boom. AWS remains the world’s leading cloud computing business with 31% market share.
Furthermore, Amazon currently enjoys a Zacks Rank #2 (Buy) rating, reflecting upward trending earnings revisions. Current quarter earnings estimates have risen by 8.8% in the last 60 days and FY24 estimates have also jumped by 8.8%. Amazon is expected to grow its earnings per share by a very impressive 28.3% annually over the next three to five years, bolstered not only by its e-commerce business, but also by its cloud computing segment AWS.
Image Source: Zacks Investment Research
Home Depot: Shares Breakout Following Election
Home Depot is another favored place for cash-flush consumers to spend. With the rise in work from home arrangements, people are making improvements to their homes more than ever. Furthermore, millennials are finally breaking into home ownership and have shown a surprising ability to earn and build wealth. As older homes scooped up and taken off the market these new buyers are likely to be making improvements to their new abodes.
Like Amazon, Home Depot also has a Zacks Rank #2 (Buy) rating, reflecting upward trending earnings revisions. Earnings growth forecasts are a bit more tepid than Amazon’s, with projections of 9.6% annual growth over the next three to five years. However, as investors recognize these new growth catalysts, we may see that number rise even more.
Especially appealing is the developments in Home Depot’s stock price action. After forming a clear bull flag over the last several weeks, HD shares have staged a clear breakout this morning, signaling that higher prices may be imminent. So long as the stock continues to trade above the breakout level, I would expect the stock to continue its march higher.
Image Source: TradingView
Should Investors Buy Shares in AMZN and HD?
As we assess the potential impacts of a Trump presidency on the economy, it’s clear that the policies historically associated with his administration could benefit stocks in consumer-driven sectors. With an approach that tends to focus on tax cuts, reduced regulation, and a business-friendly environment, companies like Amazon and Home Depot stand well-positioned to capitalize on potential boosts in consumer spending.
Both Amazon and Home Depot stocks align well with a Trump-influenced economic strategy, offering attractive opportunities for investors seeking exposure to sectors set to benefit from a stronger U.S. consumer. Investors considering AMZN or HD may find both stocks appealing for their strong fundamentals and current momentum.
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Trump Economy: 2 Stocks Set to Prosper (AMZN, HD)
Most Trump voters believe he will boost their economic security and for many, the ability to support their families is a top concern. Appealing to people’s most basic needs such as their personal finances has clearly been a winning strategy, and if the results can be delivered, Trump will likely remain popular with those who voted for him.
Although it is early days, and we can’t know exactly what policies will be passed by Trump, it is likely that we will see some sort of tax cuts for corporations and individuals as well as an easing of business regulations. These were strategies he implemented in his previous term with notable impact, and he’s likely to apply them again.
What this means is that the average American citizen is going to have a few extra dollars in their pocket at the end of every month. That money will either get invested into the stock market or get spent on discretionary purchases. Two of the market’s leading consumer discretionary businesses are Amazon ((AMZN - Free Report) ) and Home Depot ((HD - Free Report) ), and not only are they set to benefit from this new theme, but they also boast top Zacks Ranks and strong growth forecasts.
Image Source: Zacks Investment Research
Amazon: The Leading E-Commerce Stock
Even before realizing the business implications of a Trump presidency, Amazon was among my favorite stocks in the market. But with this additional catalyst of a strong consumer, it goes straight to the top of my must own stock list.
After spending the past few months trading mostly sideways since spring, AMZN shares have soared to new all-time highs in response to the election results, breaking out of their recent stagnation. And not only can Amazon expect growth from consumer spending, but its cloud services business is an absolute juggernaut, spewing cash thanks to the AI boom. AWS remains the world’s leading cloud computing business with 31% market share.
Furthermore, Amazon currently enjoys a Zacks Rank #2 (Buy) rating, reflecting upward trending earnings revisions. Current quarter earnings estimates have risen by 8.8% in the last 60 days and FY24 estimates have also jumped by 8.8%. Amazon is expected to grow its earnings per share by a very impressive 28.3% annually over the next three to five years, bolstered not only by its e-commerce business, but also by its cloud computing segment AWS.
Image Source: Zacks Investment Research
Home Depot: Shares Breakout Following Election
Home Depot is another favored place for cash-flush consumers to spend. With the rise in work from home arrangements, people are making improvements to their homes more than ever. Furthermore, millennials are finally breaking into home ownership and have shown a surprising ability to earn and build wealth. As older homes scooped up and taken off the market these new buyers are likely to be making improvements to their new abodes.
Like Amazon, Home Depot also has a Zacks Rank #2 (Buy) rating, reflecting upward trending earnings revisions. Earnings growth forecasts are a bit more tepid than Amazon’s, with projections of 9.6% annual growth over the next three to five years. However, as investors recognize these new growth catalysts, we may see that number rise even more.
Especially appealing is the developments in Home Depot’s stock price action. After forming a clear bull flag over the last several weeks, HD shares have staged a clear breakout this morning, signaling that higher prices may be imminent. So long as the stock continues to trade above the breakout level, I would expect the stock to continue its march higher.
Image Source: TradingView
Should Investors Buy Shares in AMZN and HD?
As we assess the potential impacts of a Trump presidency on the economy, it’s clear that the policies historically associated with his administration could benefit stocks in consumer-driven sectors. With an approach that tends to focus on tax cuts, reduced regulation, and a business-friendly environment, companies like Amazon and Home Depot stand well-positioned to capitalize on potential boosts in consumer spending.
Both Amazon and Home Depot stocks align well with a Trump-influenced economic strategy, offering attractive opportunities for investors seeking exposure to sectors set to benefit from a stronger U.S. consumer. Investors considering AMZN or HD may find both stocks appealing for their strong fundamentals and current momentum.