Stocks To Buy If Obama Wins

With the U.S. presidential debates heating up, and Election Day less than a month away, it’s time to take a look at what sectors of the economy will prosper under the policies of each of the leading candidates.

Regardless of whom you plan to vote for on November 4th, you should understand the differences between both campaigns and the effect each will have on your portfolio. Even the smartest investors can’t always prepare for the unexpected, as we have seen with the current credit crisis and the extreme amount of capital that has been lost by some of the safest investors. However, you can and should map out a game plan for what you do know.

In this article, we will review the sectors of the economy that will benefit if Barack Obama is elected. Throughout the debate over the domestic energy policy and the problem of sky-high gas prices, Barack Obama has been an outspoken proponent of alternative sources, including wind energy, solar energy and biofuels. His plan calls for a long-term overhaul of the traditional energy market and increased government support for renewable energy, with a lasting goal to end the United States’ dependence on foreign oil. Barack Obama has also emphasized increased government spending for domestic infrastructure, which should benefit many telecommunications companies. Also, according to his plan, many strategic and “green” technology companies would prosper, especially those dedicated to cleaning waste and sustaining the environment. Three sectors poised to increase with Barack Obama in the Oval Office are renewable energy, domestic infrastructure and green technology.

SECTOR 1
Renewable energy

The Sunpower Corporation (SPWRA) develops and produces silicon solar cells and solar panels. Sunpower’s panels have a greater efficiency than its competitors and continued advancement in this field should increase its market share over time. The $700 billion bailout plan that was recently passed by congress and signed into law will also have a welcoming effect on the solar industry. The approved package extends tax credits for renewable energy, which makes it easier and cheaper for consumers to have solar panels installed. Barack Obama’s stance on clean energy would further warm individuals as well as businesses to the idea of implementing this source of energy. This increase in demand would eventually boost industry-wide revenues. Sunpower is currently trading at the lower end of its 52-week range (as of October 14, 2008).

SECTOR 2
Domestic infrastructure
Corning Incorporated (GLW) makes glass for many display technologies, such as LCD on computers and televisions. The company also produces fiber optic cables and telecommunications hardware products. An increase in government spending for domestic infrastructure, especially within the telecommunications industry, would mean an increase in demand for these products that have made Corning a brand name. Corning is trading at a very low 4.09 P/E ratio due to its disappointing third quarter earnings report. There is no surefire way to navigate the stock market in its recent manic state. If the overall market gets hit, Corning will go right down with it, but it may be worth investigating further at this low price.

SECTOR 3
Green technology

FuelTech (FTEK) creates innovative technology to optimize the combustion systems of various solid waste applications. Simply put, its systems help control and lower pollution in an assortment of industries. Barack Obama’s plan to decrease carbon emissions would bolster the importance of “green tech” companies and ensure the continued support of the government. FuelTech has recently acquired a pair of small-cap companies that help regulate waste emissions. These strategic acquisitions will help FuelTech to diversify and expand its core business. The stock is currently trading at the low end of its 52-week range (as of October 14, 2008).

INVESTING WITH BARACK OBAMA

There are few, if any, safe bets with the current market conditions and regardless of who is in the White House, the market could still dip further. None of our ideas are firm recommendations to buy and please don’t place any bets the day after the election. Politicians often change their tune after entering office and even when they don’t it takes time for their platforms to affect the economy in a significant way. If, however, Obama remains true to his word and is elected president, take a closer look at the sectors we mentioned above, and stay away from the oil conglomerates and large pharmaceutical companies.