Trump’s tariff war brings characteristic uncertainty to the stock market, making it increasingly difficult to identify companies that are located to survive the storm.
It has been almost two months since President Trump announced his “liberation day.” Meanwhile, he presented numerous new tariff policies to level out trade relations by key partners such as China, Europe and Canada.
Since the announcement on April 2nd, S&P 500, Nasdaq Compositeand Dow Jones Industrial Average Each experienced double-digit declines – just to recover sharply in recent weeks, as some updated trade deals are in sight. The market has been roaring lately, but I don’t think investors have come out of the woods yet.
Tariff policies may change quickly, and for now it remains difficult to identify that firms could emerge more strongly as a result of these new trade transactions.
Below we will go into detail how tariffs work, highlighting two companies that are likely to emerge as winners of Trump’s tariff war.
How do tariffs work?
Customs duties are taxes levied on imported or exported goods. Generally speaking, tariffs are adopted as a mechanism to take other countries to the table and negotiate new terms of trade transactions.
Additionally, tariffs are also a way to put pressure on businesses to increase domestic manufacturing rather than outsource the overseas workforce.
While this may sound good in theory, economists worry that increasing manufacturing investment in the US will be a costly effort for businesses. Therefore, they may choose to pass those costs to the consumer.
1. Home Depot
During periods of inflation or high interest rates, consumers may postpone investments in housing improvement projects or purchasing real estate entirely. It may give investors a first sense of fear, but Home Depot (NYSE: HD)there’s more in the photo.
Homeowners are very aware that some projects cannot simply be ignored. Considering the US housing improvement industry is essentially home depot and Lowesthe company is still in a position to absorb much of this demand.
HD revenue (TTM) data from YCHARTS
According to the graph above, investors can see that over the past 20 years, Home Depot has been able to consistently increase revenue and operating margins, even in times of economic uncertainty. For reference, the two grey shade columns represent the US recession. During these times, Home Depot’s business had some pullbacks, but the company was able to ultimately beat these challenges. The current tariff situation is also unchanged.
Considering more than half of the inventory from domestic vendors, the company would not need to undertake much more cost increases from foreign imports compared to its small competitors and niche retailers. This is important as most of the company’s products are already from the US, so it’s unlikely that they need to raise prices and reduce consumer purchasing power.
The company has made many strategic moves to strengthen its supply chain, but it all puts its customers first. For this reason, I believe Home Depot’s business model will remain resilient during this prominent tariff period.
2. Nuclear
Next on my list is steel producers Nuclear. In the chart below, investors can see that Nucor’s stock has lost favour from investors throughout 2025.
Stocks bounced from low in April (along with Trump’s tariff announcement), but stocks still face some pressure. First of all, the steel industry is periodic. This makes consistent growth expectations somewhat unrealistic. Despite these dynamics, I see the nucleus on the cliffs of some advantageous opportunities.
When prices of imported steel from other countries, especially China, rise, there is a need for Nucor. Furthermore, since Trump took office in January, many companies from many different industrial sectors have been working to increase domestic manufacturing. The main of these initiatives is Project Stargate. This is a $500 billion vision for American artificial intelligence infrastructure.
I see these factors as a major tailwind for the steel industry, and I think Nucor is beginning to capture some of this spending. For this reason, Nucor’s growth may be a good time to buy a Dip, as it will allow you to witness a rapid rebound earlier than later.
Adam Spatacco is not located in any of the stocks mentioned. Motley Fool has a position and recommends Home Depot. Motley Fool recommends Lowe’s company. Motley Fools have a disclosure policy.
The Motley Fool is a partner at USA Today, providing financial news, analysis and commentary designed to help people control their financial lives. The content is produced independently of USA Today.
Should I invest $1,000 in Home Depot now?
A miscellaneous fool’s offer: Consider this before purchasing inventory at Home Depot.
Motley Fool Stock Advisor The analyst team has identified what they believe 10 Best Stocks For investors to buy now…and Home Depot was not one of them. The 10 stocks that have made the cut could potentially generate monster returns over the next few years.
When should you think about it?NetflixI created this list on December 17, 2004…If you invested $1,000 at the time of recommendation,There is $651,049! * Or when nvidiaI created this list on April 15, 2005… If you invested $1,000 at the time of recommendation,There is $828,224! *
Now it’s worth notingStock AdvisorThe total average revenue of 979% – outperformance that breaks the market compared to171%For the S&P 500. Don’t miss out on the latest Top 10 list that you can use when participatingStock Advisor.
View 10 shares »
*Stock Advisor will return as of May 19, 2025
