With the first debate this last Thursday, two issues arose on themes where Americans want change. And, as the primary election begins to heat up the attention on these matters will only increase. These 4 stocks sit directly at the crossroads where the politics meet business and the investors find profits.
While the Republican Presidential candidate front runner, Donald Trump, got more than a few laughs, and even a few boos, he might be losing steam.
Trump has grabbed the attention of many Americans given his candor and directness: most people are fed up with the typical politician. Still, Trump as President would likely be a stock market disaster.
But along the lines of the failed political system mentality that Trump is tapping into, he's not the only non-politician option for the GOP candidate.
Who was the GOP debate winner?
It certainly appears that the former Hewlett-Packard (HPQ), Carly Fiorina, is now on a lot more people's radars and she's not a typical politician, never having held a political office.
She's the only woman in the running to be the Republican Presidential candidate and she held her own on Thursday. Many media outlets and pundits are calling her the debate winner.
On Google Trends, she was the most searched for candidate on Google, even topping Donald Trump at a few points throughout the night. This includes being a Googled standout during the early debate.
Source: Google Trends
The big chink in Trump's Presidential armor appears to be foreign policy and relations. This comes as a key topic from Thursday's debate was national security. A strong military defense has always been a staple of the GOP and that was on display last night.
Trump was light on his foreign policy and national security details on Thursday, mostly focusing on Mexico when it did come to anything foreign.
Meanwhile, other candidates focused on ripping up the nuclear deal with Iran, which could raise tensions with the U.S. and Middle East. But that won't be a problem, as most of the GOP candidates plan on stomping out Iran and most of the Middle East's ability to attack the U.S. and its allies in the region. Part of this includes having more ground forces in the Middle East.
The other part of protecting the U.S. that was in focus on at the debate was cyber-related. Fiorina noted that both Russia and China are attacking the U.S, just as ISIS is also using technology to recruit more terrorists. So cyber security is now on the Presidential stage.
With all that in mind, let's look at four stocks that should benefit if the GOP wins:
Must-Own Stock For The GOP No. 1: General Dynamics (GD)
Let's start it off with national security, General Dynamics is one of the major U.S. defense contractors. One of its core businesses is making fighter jets, but it also has a long runway of providing parts to the large installed base of its Abrams tanks.
Its marine segment means it is one of only two major makers of nuclear-powered submarines. The information systems unit that it produces provide surveillance, intelligence and reconnaissance services. It's one of the purer plays on the U.S. defense department, generating 85% of revenues from the U.S. government. What's more is that it has over $70 billion in order backlog.
Must-Own Stock For The GOP No. 2: Raytheon (RTH)
Another national security play is Raytheon, which is somewhat of a technology play. This includes providing services for battlefield strategy and strategy execution. As well, its products range from sensors, radars to communication equipment.
After years of underperformance, Raytheon has been selling off non-core assets and paying down debt. It now has more cash flow to invest in research and development, which has helped it secure its position in the duopoly that is the missile market.
Must-Own Stock For The GOP No. 3: FireEye (FEYE)
Now, another topic of security on Thursday's GOP debate was cyber-related. Something that Fiorina, coming from the tech field, understands well. FireEye is one of the leaders when it comes to mitigating the fallout following a hacking.
The response and endpoint detection market, which is FireEye's bread and butter, has been one of the fastest growing parts of cyber security — expected to more than double from 2013 to 2016. FireEye was called in after high-profile attacks at the likes of Target (TGT), JPMorgan Chase (JPM) and Sony (SNE).
Must-Own Stock For The GOP No. 4: Palo Alto Networks (PANW)
Palo Alto Networks is a well-known name in the cyber security community, helping protect companies' emails, websites, and data centers. Unlike FireEye, Palo Alto Networks is more of preventive service.
And with the never-ending arms race in hacking, demand for its products should continue to expand nicely. Its firewalls are considered next generation, being on the cutting edge with the latest technology. Without getting too technical, Palo Alto Networks' firewalls allow companies to tweak traffic based on a per user basis, which helps to further close the window that hackers can attack through.
In the end, security was the focus of the first Republican Presidential candidate debate. The keys being that we need to boost both our physical and cyber security capabilities. The four stocks above are top plays when it comes to protecting the U.S. and should do well regardless of who wins the candidacy.
Another sector that is starting to heat up is housing. Driven by historically low mortgage rates, improving consumer sentiment and the fastest job growth in over a decade housing starts are starting to accelerate in 2015.
