10 Investments to Make if Biden Wins the Election

The election is almost here, and with it the end of months of suspense over who will be the next president. Not only does the response to the coronavirus pandemic depend on whether President Trump or former Vice President Biden wins the election, but it will also shape the economic recovery as each candidate favors a different set of industries and economic policies.

Keep reading to see 10 investments to make if Joe Biden wins the election.

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Perhaps the biggest policy difference between Trump and Biden is on renewable energy. Biden favors policies that would be friendlier to green energy, saying at the last debate that the country has to gradually transition away from oil, while Trump has generally been on the side of the fossil fuel industry, even withdrawing from the Paris Agreement.

Biden’s website says he plans to put the country “on an irreversible path to achieve net-zero emissions, economy-wide, no later than 2050." He plans to make a $2 trillion accelerated investment in green energy, and Brookfield Renewable Partners (NYSE: BEP) looks poised to be a major beneficiary. With 19,300 megawatts of capacity, Brookfield is one of largest publicly traded renewable energy companies. It’s a global leader in hydroelectric power and a major operator of wind and solar installations, as well as distribution and storage facilities.

ALSO READ: 4 Key Investing Moves to Make Before the November Election

One thing both parties seem to agree on is that American infrastructure is crumbling. Trump promised to get a big infrastructure package passed, but has yet to do so. Now, Biden is aiming to invest $1.3 trillion in infrastructure over the next 10 years, in order to shore up American highways, roads and bridges; expand broadband internet access; improve public school buildings; spark another railroad revolution; and improve mass transit, among other goals.

Tutor Perini (NYSE: TPC) is a construction company focused on areas like mass transit, bridges, highways, tunnels, and water systems. And while the company does serve the private sector, more than half of its revenue comes from its civil segment, whose services include the “construction and rehabilitation of highways, bridges, tunnels, mass-transit systems, military defense facilities, and water management and wastewater treatment facilities."

If Biden is able to get his infrastructure plan through, Tutor Perini should pick up some contracts for work on highways, bridges, and mass transit systems, among other areas.

Another area that Trump and Biden are divided on is guns. Trump and Republicans tend to support lenient gun laws, while Biden and Democrats favor action on gun control.

Biden wants to “get weapons of war” off American streets and “keep guns out of dangerous hands” by buying back assault weapons and high-capacity magazines that are already in communities.

One company with a unique approach to curbing gun violence is ShotSpotter (Nasdaq: SSTI), which makes technology that pinpoints the location of a gunshot and immediately notifies law enforcement, helping to speed up police response time. In incidents of gun violence, ShotSpotter makes it more likely that a criminal will be apprehended; a victim will receive proper medical attention; and evidence, including witness statements, will be collected.

Cities like New York and Chicago already work with ShotSpotter, and funding for the technology could increase under a Biden administration, boosting the business as nearly all of its customer base is local governments.

United Rentals (NYSE: URI) is the world’s largest equipment rental company, servicing residential construction, commercial construction, and industrial companies like manufacturing and energy. The company is highly cyclical and was one of the biggest winners coming out of the 2007-09 financial crisis. It could be a big winner in this recovery if Biden is elected and implements his policies.

Increased infrastructure spending would favor United Rentals as would a large stimulus package, which Democrats are trying to pass, and both would speed up the economic recovery.

Additionally, the coronavirus pandemic has boosted the housing market and could set off a chain reaction in real estate as commercial space is repurposed for new needs like e-commerce warehouses and office space is retrofitted to be more safe against the coronavirus.

Meanwhile, low interest rates are likely to remain in a Biden administration, favoring capital spending, as would the removal of tariffs on imports from China, which Biden is considering. Both of those policies would also help United Rentals.

ALSO READ: 3 Top Infrastructure Stocks to Buy Right Now

Western Union (NYSE: WU) may seem like an odd choice, but most of the money transfer company’s business comes from cross-border transactions, and a substantial number of those are from migrants sending money back home. The U.S. is the company’s biggest outbound market, with its top four recipients being India, Mexico, the Philippines, and China.

Biden wants to raise the minimum wage, which will give workers more money to send home via Western Union. And many of Biden’s policies would be more favorable to immigration as he intends to create a road map to citizenship for the 11 million undocumented immigrants in the country, as well as modernize the immigration system in other ways, including reforming the temporary worker visa program. Those policies should encourage the kind of cross-border remittances that Western Union relies on.

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Though a number of U.S. states have legalized recreational marijuana in recent years, progress at the federal level has stalled during the Trump administration. While Trump has mostly ignored the marijuana issue, Biden has advocated for the decriminalization of marijuana, which could lead to further steps to legalization, benefiting multistate operators like Cresco Labs (OTC: CRLBF).

Cresco already operates in nine states, which together make up 60% of the U.S. population. The company owns 19 of its own retail stores, and its products are sold at 780 dispensaries across the country. In other words, Cresco appears to be on the inside track for companies that would benefit from U.S. legalization.

If Biden wins the election, the marijuana sector will likely gain as a whole, but Cresco could be the biggest winner over the long term.

Trump has been focused on repealing the Affordable Care Act (ACA) during his first term, and though he’s been unsuccessful so far, it would likely be high on the agenda in a second term.

Biden, on the other hand, would expand the ACA, making healthcare more accessible to Americans.

It’s difficult to single out a healthcare stock that would be a winner from a Biden election as much of the healthcare sector would benefit, but the iShares U.S. Medical Devices ETF (NYSEMKT: IHI) looks like a good choice. Spending on medical devices, used for both elective and nonelective procedures, is correlated with access to healthcare and insurance; therefore, the companies producing them can expect to benefit from an expansion of the ACA. The ETF, which is made up of companies like Abbott Laboratories, Thermo Fisher Scientific, and Medtronic, should do well under a Biden administration.

ALSO READ: Best Healthcare Stocks to Buy in 2020

For investors fearful of a sharp increase in the money supply, which has already begun during the pandemic, gold is always a popular choice. The precious metal tends to gain value when there’s a risk of inflation or a weakening dollar, which seems likely given the high potential of a multitrillion-dollar stimulus package under a Biden administration, as well as an accommodative monetary policy.

There are multiple ways to invest in gold, including gold bullion itself and gold mining stocks, but the easiest way to gain to direct exposure to the precious metal is the SPDR Gold Trust (NYSEMKT: GLD), which tracks the price of gold bullion.

The ETF is up 25% year to date and should have more gains in store if Biden wins the presidency.

Biden hasn’t been fully clear on his policies toward China, though he favors an internationalist approach to the rising superpower. He’s also said he would revisit the tariffs imposed on Chinese imports by the Trump administration.

Without knowing the details of Biden’s China policy, it’s hard to say exactly how it would compare with Trump’s, but at the very least, it would be more nuanced. Trump hasn’t been shy about his belligerence toward China, often using the country as a scapegoat, as well as engaging in a trade war that has increased costs on a number of American companies.

There’s a good chance Biden will step back from such policies, including a recent decision to impose restrictions on China’s biggest semiconductor manufacturer, Semiconductor Manufacturing International Corp. That news rattled ACM Research (Nasdaq: ACMR), an American maker of semiconductor cleaning equipment that does most of its business in China. Its shares plunged on the news as investors feared a crackdown on Chinese chipmakers. Since a Biden policy would likely be more balanced on China, it would give ACM, an American company operating in China, more breathing room.

Pinterest (NYSE: PINS) has already had a stellar year, but momentum for the image discovery site could pick up under a Biden administration. He hasn’t attacked big tech the way some of his fellow candidates in the Democratic primary, like Sens. Bernie Sanders and Elizabeth Warren, have, but the issue is gaining traction. For example, a Democratic-majority House committee recently asserted that Alphabet's Google, Facebook, Amazon, and Apple have abused their monopoly positions.

Those companies' market power is only getting stronger during the pandemic, meaning calls for restrictions on them, including a potential breakup, are likely to build if Biden is elected. Google, Facebook, and Amazon are first, second, and third (respectively) in digital advertising. They dominate the fast-growing industry, and they all compete directly with Pinterest, putting the image discovery engine in a strong position to capitalize on any government regulation at the others' expense. Facebook, especially, may be most vulnerable to a Democratic takeover of government, as its platform has been been accused of allowing far-right voices to spread disinformation to help Trump get reelected.

5 Winning Stocks Under $49
We hear it over and over from investors, “I wish I had bought Amazon or Netflix when they were first recommended by the Motley Fool. I’d be sitting on a gold mine!” And it’s true. And while Amazon and Netflix have had a good run, we think these 5 other stocks are screaming buys. And you can buy them now for less than $49 a share! Simply click here to learn how to get your copy of “5 Growth Stocks Under $49” for FREE for a limited time only.

Elections are almost always volatile moments for the stock market, and this year that’s especially true. The pandemic has disrupted the traditional voting process, and the chance that a clear result may be not be available until several days after Election Day will only add to the level of uncertainty -- and could even spark civil unrest, especially if the apparent winner of the election changes during the counting.

If Biden wins, he will face one of the deepest crises in American history. Daily coronavirus cases are now at record highs, and nearly a quarter of a million Americans have died from the virus. More than 20 million Americans are unemployed, and the economic recovery seems to be teetering with the labor market still ailing and the potential for a rash of foreclosures and evictions, which would exacerbate the crisis.

Still, investors can expect Biden to try to implement the policy goals he’s outlined, and that will be easier for him to do if Democrats win the Senate.

In that case, Biden’s leadership should make a solid impression on the stock market as it would represent a much different course from the one Trump has charted. Look for the stocks and other investments above to be among the winners, especially in a Democratic sweep.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool's board of directors. Jeremy Bowman owns shares of ACM Research, Inc, Amazon, Facebook, and Pinterest. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Cresco Labs Inc., Facebook, and Pinterest and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool has a disclosure policy.