It's only been eight months since President Donald Trump took office, but his tariffs are already rearranging the global supply chain.
While the stock market has recovered from the crash that followed the Liberation Day tariff announcement, individual companies impacted by the tariffs are still scrambling to rearrange their supply chains to respond to the higher import tax rates, which research from The Motley Fool shows here.
RH, the company formerly known as Restoration Hardware, said it was moving production out of China, planning to lower its sourcing from that country to just 2% by the end of the year, and increasing production at its factory in North Carolina.
Image source: Getty Images.
Lululemon is adjusting its e-commerce fulfillment network now that the de minimis exemption, which excluded import taxes on shipments worth less than $800, has been removed.
Reshoring has become a major theme in the evolving supply chain situation as well as a goal of the Trump administration, and while some companies are clearly struggling with the new tariffs, others are poised to benefit. Let's take a look at three of them.
1. Prologis
Real estate investment trusts (REITs) look like a great place to start if you're looking for beneficiaries from the reshoring boom, as it's likely to drive an investment in property.
Prologis (PLD 2.30%), in particular, looks set to be a winner as it's the world's largest owner of logistics real estate or warehouses, contracting with companies like Amazon and FedEx. As companies bring more manufacturing back to the U.S., they will need more warehouses to store and distribute those products. The company also sees demand increasing for facilities in Mexico due to the related trend of nearshoring.
In its second-quarter earnings report, management said its leasing pipeline has reached historically high levels, and it expects strong demand to continue.
The company also raised its guidance for the year due to in-development starts and acquisitions, showing that its expansion efforts are accelerating.
2. Manhattan Associates
Staying in the logistics arena, another company that looks poised to capitalize on the reshoring trend is Manhattan Associates (MANH -0.12%), a maker of logistics software to help businesses manage everything from warehouses to distribution to customer service and sales.
The supply chain changes from the Trump tariffs are likely to drive demand for its services. In fact, one of the companies it's helped is RH, which reduced inventory by 40% and returns by 25% with the help of Manhattan Associates.
Remaining performance obligations, a proxy for backlog, increased 26% in the second quarter, a promising sign for future growth, and should see a steady tailwind as companies adapt to the new trade rules.
3. Intel
Intel (INTC -4.47%) may already be benefiting from the reshoring trend. In fact, maybe more so than any other company, the federal government has been trying to prop up Intel, making it a cornerstone of a renewed American semiconductor manufacturing industry.
Intel won an $8 billion grant from the CHIPS Act, and then Trump took the unusual move of guiding the federal government to take a stake in the company, investing $8.9 billion, which includes some of the CHIPS funding, due to its strategic interest in ensuring that the U.S. has an adequate supply of semiconductors.
Shortly after that announcement, Nvidia took a $5 billion stake in Intel, and Apple was reportedly interested in taking a stake.
Intel may be struggling as the company has been unable to capitalize on the AI boom, as revenue has been flat, and it's losing money. However, the company's long history and its manufacturing assets mean it should continue to attract interest from the U.S. government since reshoring is a top priority.
