A funny thing happened during President Donald Trump’s tenure in the White House. Despite his general criticism of them, California-based technology companies in the S&P 500 are thriving.
The S&P 500’s 31 California-based tech companies are up 108% on average since Trump was inaugurated on Jan. 20, 2017. All three of the top stocks since Inauguration Day are California-based techs: Advanced Micro Devices (AMD), Fortinet (FTNT) and ServiceNow (NOW). This according to an Investor’s Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. AMD and ServiceNow are both members of IBD’s Leaderboard list of top stocks.
See All The Most Promising Stocks On Leaderboard
In fact, the Technology Select Sector SPDR ETF (XLK) is up 82% since Inauguration Day, topping all 11 S&P 500 sectors. These tech-charged gains easily surpass the 42% gain of the SPDR S&P 500 ETF Trust (SPY) from Trump’s inauguration.
Trump often directed criticism toward larger tech companies in California during his campaign. And Trump’s role in the markets and economy is again front-and-center following his impeachment by the U.S. House of Representatives.
But data show why investors know to watch fundamentals — not politics.
California’s S&P 500 Tech Stocks Dominate Under Trump
Looking further still, tech has done even more remarkably well with Trump in the White House. Seven of the top 10 S&P 500 stocks during the Trump Administration are in the tech sector. And five of those tech-stock winners are based in California.
The Golden State and Trump have tangled on multiple occasions, including his singling out of several of the largest companies based there. Trump scolded Apple (AAPL) for its global manufacturing network, Alphabet (GOOGL) for its online search filtering and Facebook (FB) for its role in affecting political elections.
And yet, shares of Apple, Alphabet and Facebook all powered higher under Trump. Apple is up 133% and is now the S&P 500’s most-valuable company. Alphabet is up 64% since his inauguration and Facebook 61%. It’s important to note Trump is far from the only politician to criticize these companies, especially Facebook.
Advanced Micro Devices, though, is the top Trump winner so far. Shares are up an astounding 342% since the inauguration. The Santa Clara, Calif.-based chipmaker is benefiting from an easing of trade war worries.
AMD is also seen as being a winner in an expected semiconductor industry recovery in 2020. AMD earnings per share are seen jumping 77% in 2020 to $1.10. Strong fundamentals and stock gains give AMD stock an IBD Composite Rating of 87.
Trump’s Favored S&P 500 Stocks And Sectors Languish
Meanwhile, Trump’s more favored sectors and industries haven’t performed nearly as well.
Energy stocks, too, have done notably poorly. Four of the 10 worst performing S&P 500 stocks since Trump’s inauguration are in the energy sector. Cimarex Energy (XEC), a Denver-based oil and gas exploration company, dropped 63% since inauguration. The company’s earnings per share is seen falling 44% in 2019 to $4.10.
And don’t forget the U.S. automakers, which Trump took great interest in during his campaign. Their shares have lagged, too. Shares of automaker General Motors (GM) are up just 0.4%, while Ford Motor (F) is down 23.8%. Ford’s 2019 earnings per share are seen falling nearly 5% to $1.24.
What About Amazon.com?
One of Trump’s favorite corporate targets is Amazon.com (AMZN). Trump and Amazon.com CEO Jeff Bezos have indirectly clashed several times. The company is also challenging the government’s recent decision to award a large cloud-computing project to Microsoft (MSFT).
Amazon.com is a consumer discretionary stock based in Seattle, so it’s not in this analysis. But it is thriving. Shares of the company are up more than 120% since Trump’s inauguration. And profit next year is seen soaring more than 30% in 2020.
Looks like being on Trump’s foe list isn’t as scary as it might seem.
Best S&P 500 Stocks Since Trump’s Inauguration
IBD, S&P Global Market Intelligence
Author: Matt Krantz
Source: Investors: The 10 Stocks Thriving Under Trump Will Surprise You