10 Stocks Likely To Gain if Romney Wins: RBC
NEW YORK (TheStreet) -- Four more years or four different years? We will know by end of day Tuesday. Hopefully, barring any recounts.
Markets tend to rise the day after a Republican victory, but long-term returns are dependent on management execution rather than who is in the White House, as Jim Cramer reminded viewers on CNBC's Mad Money on Monday.
Still, in the days immediately following the election, the market will likely bid up stocks from select sectors such as energy, defense and banking if Romney wins, given these sectors are where the two parties have the most differences in approach.
RBC Capital markets identified more than 15 stocks that stand to benefit from a Romney victory, published in a report last week, as well as a handful that could benefit if Obama stays in office.
Here are ten stocks ranked by ascending order of market cap that stand to gain if Governor Romney wins. Chipotle Mexican Grill
CMG Total Return Price data by YChartsShares of Chipotle Mexican Grill (CMG) are down 21% year-to-date. Restaurant stocks including Chipotle and Darden Restaurants (DRI) if Obamacare is repealed according to RBC Capital analyst Larry Miller. Restaurants the analysts cover say they expect additional health care to cut 1% to 2% from their margins beginning in 2014, with steeper effects for those that are 100% operated as opposed to franchises. These two stocks are most poised to benefit if Romney wins and Obamacare is repealed. "Darden is a labor-intense business; and as such, it is already testing operating with more part-time employees to skirt the new law. The effect on Chipotle's stock would be greater because any earnings compression would be magnified by its high multiple." Chipotle, of course, has been in the news after hedge fund manager David Einhorn revealed he was short the company, arguing it is overvalued. and is facing heavier competition from a revamped Taco Bell, of Yum!Brands (YUM). Read why Einhorn's Chipotle short is starved for logic.
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