Please ensure Javascript is enabled for purposes of website accessibility

The 3 Best Stocks to Buy for a Biden Bull Market

By Joe Tenebruso - Jan 25, 2021 at 11:23AM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Here's where to invest your money now.

A new presidential administration brings change, and with it, new opportunities for investors.

President Joe Biden has laid out plans to make housing more affordable for Americans, combat climate change, and position the U.S. as a leader in electric-vehicle production.

Here's how you can profit from the coming bull markets in each of these soon-to-be booming investment sectors, including three stocks you might want to consider buying.

A sculpture of a bull.

Image source: Getty Images.

1. Redfin

Biden's housing plan calls for a new tax credit of up to $15,000 for first-time homebuyers. By helping to offset the costs of buying a home, Biden's plan could ignite a housing boom, particularly as the economy recovers once the pandemic subsides.

Redfin (RDFN -3.85%) is an excellent way for investors to profit from a surge in new home sales. The tech-powered real estate services company is rapidly increasing its share of the $80 billion U.S. brokerage market, thanks to the large savings it often provides to home sellers.

By paying its agents a salary, rather than commissions, Redfin can sell homes for fees as low as 1%. Compared to the typical agent commission of 2.5%-3%, Redfin can save home sellers as much as $5,000 on a $250,000 home.

Together with its fast-growing mortgage, title, and iBuying businesses, Redfin's rapidly expanding brokerage operations give investors many ways to win.

2. Brookfield Renewable

Biden believes climate change is the "No. 1 issue facing humanity." He wants the U.S. to generate more energy from renewable sources to achieve net-zero emissions by 2050. And he's willing to invest $2 trillion in clean energy projects to reach that goal. 

Biden's climate plan would be a boon for Brookfield Renewable (BEP 0.95%) (BEPC 0.99%). Brookfield owns a wide array of renewable energy investments, including hydroelectric, wind, and solar projects. 

Brookfield passes the profits it generates from these projects on to its investors via a rising cash dividend. And with Biden's plan likely to create more investment opportunities in green energy projects, Brookfield Renewable is set to reward its investors with even larger cash returns in the years ahead.

3. Tesla

In addition to clean energy, Biden wants the U.S. to be the global leader in electric vehicles (EVs). His auto industry plan calls for the government to incentivize the purchase of EVs for federal, state, and local fleets. Biden also wants to install 500,000 charging stations across the country. 

Biden's plan is likely to accelerate Tesla's (TSLA -2.68%) growth. The EV leader's sales are already growing rapidly, and Biden's intentions to boost American demand for clean vehicles could turbocharge Tesla's profit generation over the next decade.

Due in part to the Biden administration's support, Wedbush analyst Daniel Ives predicts that EVs could account for 10% of global auto sales by 2025, up from 3% today. In turn, he believes Tesla could deliver 5 million EVs annually by 2030, up from just under 500,000 in 2020. 

If Ives is correct, Tesla's vehicle sales could rise tenfold over the coming decade, while creating fortunes for investors along the way.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Tesla, Inc. Stock Quote
Tesla, Inc.
$741.19 (-2.68%) $-20.42
Brookfield Renewable Partners L.P. Stock Quote
Brookfield Renewable Partners L.P.
$34.99 (0.95%) $0.33
Redfin Corporation Stock Quote
Redfin Corporation
$10.73 (-3.85%) $0.43
Brookfield Renewable Corporation Inc. Stock Quote
Brookfield Renewable Corporation Inc.
$35.80 (0.99%) $0.35

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/18/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.