We decided it would be fun to take a look at what stocks might be winners and losers under each of the four leading presidential candidates. We focused primarily on their economic and tax plans to look at what changes might affect the investment world. We’ll go through the candidates in alphabetical order by first name – Bernie Sanders, Donald Trump, Hillary Clinton, and Ted Cruz. Before we dive into our picks and pans for another Clinton presidency, I want to explain a little bit about how we will approach things.

Throughout this series we are going to assume that candidate’s economic plans, as they are defined now, are enacted as is. Obviously, with a divided Congress, no plan will be enacted exactly as the candidate presents it today. Not only that, if politicians are known for one thing, it’s lying. For all we know, these proposals may not even be close to what the candidates actually plan on doing. Additionally, we are also not the “numbers police” and are not here to debate whether a candidate’s numbers add up (you want to enact $9 trillion in tax cuts, go ahead, we will analyze that) and we are not “Very Serious People” deciding whether a plan is “realistic” (you want universal healthcare or a giant wall, we will analyze that). We are going with what the candidates say they will do.

Even though nothing the candidates present is enacted as is, the plans usually do at least show the direction that candidates are leaning. For example, Cruz and Trump are proposing huge tax cuts. Is a flat tax really likely to be enacted? No, but it’s likely if elected Cruz would push hard for some type of tax cut. Likewise, is Bernie Sanders' $5 trillion infrastructure plan likely to be enacted as is? No, but if elected he’s likely to push very hard for increased infrastructure spending.

Although the information about the candidates' plans we have to go on is imperfect and subject to change, we still think it’s useful to look at who the winners and losers might be under their plans.

Hillary Clinton is probably the hardest candidate to analyze and come up with a list of definite stock buys and sells. Both Bernie Sanders and Donald Trump are outside the political mainstream. Ted Cruz, while part of Republican Party, is not generally regarded as part of the Republican mainstream. Hillary Clinton is about as mainstream as you can get for the current Democratic Party. After eight years under a conventional Democrat presidency with Barack Obama, how much would anything really change under Clinton?

Additionally, none of Clinton’s policy proposals are near the same scale as the other candidates. Cruz and Trump are proposing enormous trillion dollar tax cuts, and Trump has repeatedly mentioned reinstating some types of tariffs to protect domestic manufacturing companies. Sanders has proposed sweeping overhauls of the American healthcare and education system along with enormous infrastructure spending. Clinton’s economic plans are mild in comparison. Just some tweaks here or there. As such it’s probably a safe bet that the economic trends we’ve seen for the last eight years will largely continue with Clinton.

Clinton’s economic platform is very vague in many areas, so we will try to sum up the important economic proposals as best we can. The major concrete proposals seem to be raising the minimum wage to $12 or $15 per hour, spending $275 billion over five years on infrastructure, and spending $350 billion to make in-state college education free or very low cost. The rest of the proposals are too minor to have much impact on the economy (closing the carried interest loophole won’t send all hedge funds out of business for example) and universal pre-school, while nice if you support that, isn’t really going to create many short-term actionable investment opportunities.

Buy:

Gun manufacturers

There’s almost nothing more automatic in the investment world then Democratic election victories leading to a spike in gun sales. Gun sales and gun manufacturers like Sturm, Ruger & Co. (RGR, Financial) and Smith & Wesson (SWHC, Financial) have had a strong run under Obama. We think that run could continue if Clinton were to be elected. Additionally, most of the proposals Clinton has put forth on gun control are along the lines of stricter background checks, waiting periods and reinstituting the assault weapons ban passed by her husband. None of these proposals are likely to seriously restrict sales by gun manufacturers, but they should serve to send demand higher as many people will fear even tighter regulations in the future. The one wildcard is how long can strong gun sales continue. Guns are a luxury item (not a necessity, for most anyway) and with proper care and maintenance, firearms can last a lifetime. Therefore, gun purchases are highly discretionary and it’s possible we could see sales start to plateau. In any case, I believe there is likely to be a high initial spike in sales if Clinton were to be elected.

Defense contractors

We also think defense contractors like Lockheed Martin (LMT, Financial), Northrop Grumman (NOC, Financial)Â and General Dynamics (GD, Financial) would do well under a Clinton presidency. Both mainstream Republican and Democrat politicians have consistently supported military intervention in numerous overseas conflicts and the global war on terror. We see nothing that would change under Clinton. Her foreign policy positions are very interventional and as Secretary of State, she has frequently been a vocal supporter of military intervention in various overseas conflicts. Out of all four presidential candidates, we believe defense contractors would see the greatest growth under Clinton.

Education companies

Clinton’s proposal to expand access to higher education, like Sanders' proposal, will likely be a boon to any company producing goods or services for the education market. With what is sure to be a huge influx of new college students, beaten down textbook and educational services company Pearson (PSO, Financial) should do well (its largest market is the U.S.) as well as companies like Scholastic Education (SCHL, Financial) and publisher John Wiley & Sons (JW.A, Financial).

Sell:

For-profit education

Like Sanders, Clinton aims to dramatically increase the affordability of college education with the goal of making in-state four year education free to very low cost. Dramatically expanding access to higher education will put even more pressure on private for-profit schools. Perhaps companies like DeVry (DV, Financial) or Strayer (STRA, Financial) may find a small market niche of students to cater too, but I believe they likely to drastically shrink in size if not disappear outright.

Low wage companies

Clinton has proposed raising the minimum wage to around $12 to $15. This proposal is not as large as Sanders and her overall platform does not include as many other policies that would be a boon to labor (e.g. large jobs programs). Thus, her economic proposals should put some cost pressures on companies that rely heavily on low wage labor, but not as much as Sanders' proposals. Companies like Wal-Mart (WMT, Financial), McDonald's (MCD, Financial)Â and Wendy’s (WEN) will see their labor costs rise. It’s hard to guess how much the margin pressure may be offset by increased sales. A higher minimum wage gives workers more money to spend and Clinton’s education proposals should as well. College graduates will have more money to spend on discretionary spending rather than debt repayment. Additionally, Clinton’s infrastructure plan should boost the economy and provide a bit of a tailwind for low wage companies. How the all the moving parts interact is anyone’s guess, so I’d reduce exposure to low wage companies while boosting exposure to consumer oriented companies that already pay above minimum wage salaries.

Final thoughts

Clinton’s plans are extremely similar to Sanders', just on a smaller scale. He proposes spending $5 trillion on infrastructure, she wants $275 billion. He wants to make college free, she wants to make college merely low cost. He wants universal healthcare, she supports a litany of tweaks to the Affordable Care Act to reduce costs to consumers. The list goes on. If you want more details on stocks to buy and sell based on Clinton’s platform, I’d recommend reading our article on Sanders and simply scaling everything down.