As negotiations and posturing continue between the U.S. and China, some individual company analysts this week used the drama to tout stocks they cover which are positioned well if there is a trade war.
At a rally on Wednesday night, President Donald Trump told a crowd that China “broke the deal.” Negotiations were expected to continue Thursday evening with Chinese Vice Premier Liu He having dinner with Trump just hours before the tariff hike.
The Dow is down more than 700 points in this week’s sell-off while the S&P 500 has lost more than 3% after Trump said last weekend that tariffs would rise on China.
While some analysts found stocks with a defensive focus, others found companies that were nearly immune to the trade battle.
One stock steering clear of any tariff trouble is Atkore International, according to analysts at RBC. Atkore manufactures electrical distribution products and reported solid earnings on Tuesday.
“Management remains confident in its ability to manage tariff headwinds. The company has minimal direct tariff exposure, and for the products that it does import from overseas, its competitors source these products from overseas too,” RBC said.
Shares are up 11% over the last month.
Power and utility stocks such as American Electric and Entergy are, “made for performing in rising trade tension,” say UBS analysts.
“Within utilities the most defensive names will be fully-regulated companies,” analyst Daniel Ford wrote.
Both stocks are down slightly in midday trading but up over 20% the last year.
AquaVenture Holdings, which provides water purification system solutions also reported solid earnings this week.
The company has, “essentially zero exposure to US-China tariffs or recent news headlines of escalating trade tensions,” said RBC analyst Deane Dray.