To The Moon

This week, we have the U.S. President Trump imposed far-reaching new tariffs on U.S. trading partners, including a 10% levy on all imports and higher reciprocal tariffs for some countries.

The announcement triggered market volatility immediately with S&P 500 ETF Trust (SPY) falling 5.85% at the close of Friday (04 Apr).

SPY Option Implied Volatility - Volume Put-Call Ratio Indicate Bearish Sentiment

Overview for all option chains of SPY. As of April 4, 2025, SPY options have an IV of 37.16 % and an IV rank of 96.69%. The volume is 15,103,401 contracts, which is 138.35% of average daily volume of 10,916,475 contracts. The volume put-call ratio is 1.63, indicating a bearish sentiment in the market.

Identifying Potential Tariff-Resistant Stocks To Curb Trade Turbulence

Identifying "tariff-proof" U.S. equities involves focusing on companies with primarily domestic operations, limited exposure to international supply chains, and industries less impacted by trade policies.

Tariffs could hurt profits if companies absorb the costs, reduce sales if costs are passed to consumers, or strengthen the US dollar, impacting S&P 500 firms with foreign revenues. Companies with domestic revenue and minimal global supply chain exposure can better weather trade disruptions, with some benefitting by serving cost-conscious consumers in economic downturns.

In this article, I would like to share three stocks/companies which I think potentially could be tariff-resistant, but we as investors need to note that no company is entirely immune to macroeconomic risks.

Tariffs Could Impact Corporate Earnings

Companies could decide to absorb higher costs themselves, and profits could suffer.

Companies could pass costs onto the consumer, and sales could take a hit.

Tariffs could increase the value of the U.S. dollar, according to Goldman. A higher dollar could drag down the earnings of certain S&P 500 companies, which generate 28% of their revenues outside the US.

Criteria To Look At For So-Called “Tariff-Proof” Stocks

Before we scan or look at which stocks had suffered the recent selloffs, we need to understand why these stocks had suffered the turbulence of selloffs, and whether these stocks can be potential “Tariff-Proof” stocks.

I think these are some factors I would based on when looking at these stocks:

Companies that are less exposed to global supply chains, with domestic revenue streams and resilience to retaliatory tariffs.

Companies are better positioned to withstand global trade disruptions and their economic impacts. Some companies are poised to benefit from potential headwinds due to their countercyclical nature, providing affordable goods or services to cost-conscious consumers

1. NextEra Energy (NEE)

• Sector: Utilities (Renewable Energy).

• Rationale:

  Operates almost exclusively in the U.S., primarily in regulated electricity markets (Florida) and renewable energy infrastructure.

  Minimal reliance on imported materials due to domestic supply chains for solar, wind, and grid infrastructure.

  Utilities are inherently domestic and benefit from predictable, regulated revenue streams.

NextEra Energy delivered full year adjusted earnings per share of $3.43, up over 8% from 2023. The company achieved a compound annual growth rate in adjusted EPS of over 10% since 2021. The company plans to invest approximately $120 billion over the next four years, which will expand its combined fleet to roughly 121 gigawatts.

NextEra Energy announced a framework agreement with GE Renova to build natural gas power generation solutions, supporting multiple gigawatts for data centers and other sectors.

$NextEra(NEE)$ YoY EBITDA Growth as of today (March 13, 2025) is -60.07%. NextEra Energy EBITDA for the quarter ending December 31, 2024 was $2.522B, a 41.9% decline year-over-year.

• NextEra Energy 2024 EBITDA was 13.24B, a 19.21% decline from 2023.

• NextEra Energy 2023 EBITDA was 16.388B, a 84.74% increase from 2022.

• NextEra Energy 2022 EBITDA was 8.871B, a 24.47% increase from 2021.

2. Casella Waste Systems, Inc. (CWST)

• Sector: Industrials (Waste Management).

• Rationale:

  Dominates U.S. waste collection, recycling, and landfill services, with virtually no international exposure.

  Recession- and tariff-resistant demand, as waste services are essential regardless of trade policies.

  Supplies and equipment (e.g., trucks) are largely sourced domestically.

$Casella Waste(CWST)$ would stand out as a tariff0-proof stock due to its exclusive focus on domestic waste management markets across the Northeast and Mid-Atlantic United States. Waste management is an essential service, inoculating the company in the event of a severe economic downturn.

In 2024, Casella Waste Systems closed eight acquisitions with over $200 million in annualized revenue. Additionally, three acquisitions were completed in early 2025 with approximately $40 million in annualized revenue. The company plans to continue leveraging its strong pricing and operating programs while expanding its collection business, which now accounts for over 60% of consolidated revenues. Despite a challenging market for construction and demolition (C&D) and special waste volumes, Casella is focused on internalizing waste and improving operation.

Revenues increased by 18.9% year-over-year to $427.5 million in Q4 2024. Adjusted EBITDA grew by 15.6% to $95 million, marking three consecutive years of over 20% adjusted EBITDA growth.

Adjusted free cash flow increased by 23% to $158.3 million for fiscal year 2024, surpassing the high end of guidance.

The recycling processing operations and national accounts business experienced a strong year, with resource solutions revenues up 9.7% year-over-year.

3. UnitedHealth Group (UNH)

• Sector: Healthcare (Insurance & Services).

• Rationale:

  Largest U.S. health insurer, with operations focused on domestic healthcare services (Optum, insurance plans).

  Healthcare demand is inelastic and driven by demographic trends, not tariffs.

  Limited reliance on global supply chains compared to pharmaceutical manufacturers or medtech firms.

$UnitedHealth(UNH)$ YoY EBITDA Growth as of today (March 27, 2025) is 2.65%.  UNH last earnings call highlighted strong revenue growth in various segments, operational efficiencies, and successful expansion in value-based care and pharmacy services. However, it also acknowledged challenges such as increased medical care ratios, cyberattack disruptions, and external pressures from Medicare rate cuts and high drug costs.

UnitedHealth Group's (UNH) latest EBITDA growth, based on the fiscal year ending December 2024, is approximately 13.0% as a median, with a peak of 17.8% in December 2022 and a 5-year low. 

Optum Rx customer retention exceeded 98%, with a record 750 new clients. Operating cost ratio improved by about 150 basis points over the prior year, supported by AI-driven initiatives.

For 2025, UnitedHealth Group projects revenues approaching $340 billion with a medical care ratio of 86.5%, reflecting an increase of 100 basis points from 2024 due to factors like IRA impacts and Medicare funding cuts. The company plans to serve an additional 5.4 million value-based care patients and generate cash flow from operations nearing $33 billion. They also aim to pass 100% of PBM rebates to customers by 2028. The emphasis remains on enhancing consumer experience and leveraging digital tools, evidenced by a 66% increase in mobile app visits. Despite external pressures, UnitedHealth Group maintains a strong outlook, focusing on value-based care and strategic growth initiatives.

Key Considerations:

Domestic Focus: All three companies generate nearly 100% of revenue within the U.S.

• Companies with primarily domestic supply chains could gain a competitive edge as tariffs increase the cost of imports.  

• This includes U.S. steel, aluminum, and automotive manufacturers that may benefit from tariff protection.  

• Small-cap stocks with a focus on domestic revenue streams may also outperform.  

Pricing Power: Ability to pass costs to consumers (e.g., utilities, healthcare premiums).

• Sectors less exposed to international trade tensions, such as utilities and telecommunications, may offer stability.  

• These sectors tend to be less reliant on global supply chains and are often considered essential services.

Essential Services: Utilities, waste management, and healthcare are non-discretionary.

• Gold and other precious metals are often seen as safe havens during periods of economic uncertainty and market volatility.  

• Treasury bonds, despite lower yields, can provide portfolio protection during equity market downturns.

• Diversifying across asset classes is crucial to managing increased volatility.  

• This includes balancing stocks, bonds, and alternative investments to mitigate risk.  

Caveats:

• Even "domestic" companies may face indirect risks (e.g., inflationary pressures, regulatory changes).

• Diversification across sectors reduces concentration risk.

Summary

While no company is fully tariff-proof, exploring stocks that are less reliant on global supply chains, with domestic revenue streams. It is crucial to be aware of the effect of the tariffs on international trade, and how certain countries may react to them.

As investors, we will need to be keeping informed of ongoing political situations is very important. Trade deals can be changed or amended, causing massive market fluctuations.

As always, investment choices should be made with respect to the investors personal level of risk tolerance. In essence, investors should focus on resilience, diversification, and a careful analysis of how tariffs may affect specific sectors and companies.

Appreciate if you could share your thoughts in the comment section whether you think these three stocks could be something we can look into for tariff-resistance strategy.

@TigerStars @Daily_Discussion @Tiger_Earnings @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.