Stocks That May Get Stimulus Boost

The U.S. Senate and House of Representatives came to a $789 billion agreement on a tax-cutting and spending stimulus bill this week. Since Senate Republicans signaled they won't attempt to use procedural methods to block or delay final passage, we can now take a deeper look to see which companies and funds may benefit.

To meet President Barack Obama's pledge to "save or create 3.5 million jobs and get our economy back on track," the package provides a plethora of perks.

To re-prime the retail pump, direct aid to individuals is slated to come in the form of a $250 one-time payment to Social Security recipients. For those of us still holding down a job, an income-capped $400 tax credit can be doled out in our paychecks as soon as withholding tables can be updated. Look for this money to begin to flow in the second quarter.

The two consumer-staples retailers favored by TheStreet.com Ratings' stock model are Wal-Mart ( WMT), at a "buy" rating of B, and BJ's Wholesale Club ( BJ) at B-. Tip-toeing into the shallow end of consumer-discretionary retailers, the model likes Family Dollar ( FDO), at B, and Dollar Tree ( DLTR), at B-.

To push ahead so-called "shovel-ready" building projects, the compromise puts forth $46 billion for road building and other transportation-development plans. While legislators bemoaned that this is just a drop in the bucket compared to the scope of our crumbling infrastructure and the need for job creation, it is a step in the right direction down the long, bumpy road to recovery.

One year ago and again last November, in my articles on funds favored by an Obama presidency, PowerShares Dynamic Building & Construction ( PKB) was offered as a potential beneficiary from expanded government construction contracts. This is still the case.

Two companies rated by our stock model in the "buy" range are in the right line of business to bid for a piece of the $19 billion in the stimulus package slated for revamping the way health care companies keep patient records. Both Transcend Services ( TRCR), rated at B-, and Computer Programs and Systems ( CPSI), rated at B, provide information-technology services to hospitals and other health care providers.

There is no guarantee that any of the companies or funds mentioned in this article will directly benefit from the stimulus package. However, there is something to be said for being in the right place at the right time.

For more information, check out an explanation of our ratings.

Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by TheStreet.com, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.

More from Personal Finance

Best Real Estate Markets for Homeowners in the U.S.

Best Real Estate Markets for Homeowners in the U.S.

How to Be a Winner Like Legendary Former General Electric CEO Jack Welch

How to Be a Winner Like Legendary Former General Electric CEO Jack Welch

Best U.S. Cities for New College Grads

Best U.S. Cities for New College Grads

33 Pictures of the Drastic and Deadly Impacts of Climate Change

33 Pictures of the Drastic and Deadly Impacts of Climate Change

30 Mind-Blowing Concept Cars and Cars of the Future We Want to See Built

30 Mind-Blowing Concept Cars and Cars of the Future We Want to See Built