As the U.S. presidential election looms, Goldman Sachs analysts have outlined sectors and respective stocks that could potentially outperform in the event of a Republican victory. In their “Republican policy outperformers basket,” GS analysts have selected stocks that they forecast would thrive under a Trump-led Republican House. These selections are based on the potential policy changes and priorities anticipated under such a government.

Sectors Poised for Growth

According to Goldman Sachs, sectors expected to thrive under a Republican administration include:

Financials

Under a Trump-led Republican House, companies within the Financials sector (NYSEARCA:XLF) are anticipated to benefit from easing capital rules, antitrust encouragement, a deal-making environment, and additional trading revenue during election years. Companies expected to rebound in this category include Jefferies Financial Group (JEF), Evercore (EVR), The Carlyle Group (CG), Raymond James Financial (RJF), Stifel Financial Corp. (SF), Moelis & Co. (MC), TPG (TPG), PJT Partners (PJT), and Piper Sandler (PIPR).

Steel

The Steel industry (SLX) could witness a surge in U.S.-based steel manufacturing. GS analysts have identified American equities set to benefit, including Vale SA (VALE), Steel Dynamics (STLD), Reliance Steel & Aluminum (RS), Nucor Corp. (NUE), Commercial Metals (CMC), Cleveland-Cliffs (CLF), ATI (ATI), ArcelorMittal (MT), Carpenter Technology (CRS), Gerdau (GGB), Ryerson Holding (RYI), and Worthington Steel (WS).

Domestic Security and Law Enforcement

According to Trump’s reported plans, record funding is expected to be allocated for hiring and retaining police officers. Stocks within the domestic security basket that could potentially benefit from this allocation include Axon Enterprise (AXON), Parsons Group (PSN), The GEO Group (GEO), CoreCivic (CXW), Gen Digital (GEN), CyberArk Software (CYBR), SentinelOne (S), Zscaler (ZS), Crowdstrike Holdings (CRWD), and Palo Alto Networks (PANW).

Onshoring Enablers

Stocks involved in electrification and automation are anticipated to benefit from onshoring initiatives. This category includes companies such as Rockwell Automation (ROK), Regal Rexnord Corp. (RRX), Flex Ltd (FLEX), Jabil (JBL), Amphenol Corp. (APH), and TE Connectivity (TEL).

Onshore Production and Manufacturing

Companies with a high manufacturing footprint in the U.S. or with announced initiatives to move operations home are poised to benefit under a potential Republican administration. The identified stocks in this category include Mohawk Industries Inc. (MHK), KLA Corp. (KLAC), Lam Research Corp. (LRCX), Texas Instruments (TXN), Applied Materials (AMAT), Intel Corp. (INTC), Broadcom Inc. (AVGO).

Border Construction

Under a Republican government, companies involved in the construction of tighter borders could potentially see a surge. This category includes Fluor Corp. (FLR), AECOM (ACM), KBR Inc. (KBR), Jacobs Solutions (J), Quanta Services (PWR), Caterpillar Inc. (CAT), Granite Construction (GVA), Cemex SAB de CV (CX), Eagle Materials (EXP), Martin Marietta Materials (MLM), and Vulcan Materials (VMC).

Small-Business Exposure

Companies with almost all of their sales generated from small businesses are anticipated to benefit. The identified stocks in this category include Yelp Inc. (YELP), Toast Inc. (TOST), Payoneer Global (PAYO), AGCO Corp. (AGCO), Paychex (PAYX), Automatic Data Processing (ADP), Deere & Co. (DE), Upwork (UPWK), Paycor HCM (PYCR), ACV Auctions, BILL Holdings, DigitalOcean Holdings (DOCN), Squarespace Inc. (SQSP), and Corteva Inc. (CTVA).

Energy

The Energy sector (NYSEARCA:XLE) is another area expected to benefit from traditional commodity production policies under a Republican administration. Companies identified in this category include Exxon Mobil (XOM), Cenovus Energy (CVE), Chevron Corp. (CVX), Suncor Energy (SU), Patterson-UTI Energy (PTEN), Helmerich & Payne (HP), Halliburton (HAL), Schlumberger NV (SLB), Diamondback Energy (FANG), Canadian Natural Resources (CNQ), Marathon Oil Corp. (MRO), EOG Resources (EOG), Devon Energy (DVN), Coterra Energy (CTRA), Ovintiv Inc. (OVV), Matador Resources (MTDR), Murphy Oil Corp. (MUR), SM Energy (SM), World Kinect Corp. (WKC), Cheniere Energy (LNG), ONEOK Inc. (OKE), The Williams Companies (WMB), and Kinder Morgan (KMI).

Coal

U.S. equities that could benefit from additional coal in the U.S. include Peabody Energy (BTU), Uranium Energy (UEC), CONSOL Energy (CEIX), Contrus Energy Corp. (LEU), and Hallador Energy (HNRG).