McDonald's, Yeti, and Martin Marietta Seen as Resilient Picks Amid New U.S. Tariffs

GuruFocus
6 hours ago

Morgan Stanley analysts named McDonald's (MCD, Financials), Yeti Holdings (YETI, Financials), and Martin Marietta Materials (MLM, Financials) as stocks that could better withstand market volatility stemming from newly imposed U.S. tariffs, multiple news outlets reported. President Donald Trump's reciprocal trade measures took effect April 2 and are expected to put broad pressure on equity markets.

In a research note published Wednesday, Morgan Stanley said McDonald's international footprint and reliance on local suppliers position it to navigate the new trade environment more effectively than peers. The fast-food company also pays a dividend yield of 2.26%, which analysts said enhances its defensive appeal during a potential economic slowdown. Wall Street analysts maintain an overweight rating on the stock.

Yeti Holdings, which has partial exposure to Mexico-based manufacturing, faces some risk from the tariffs. However, analysts said the outdoor products company has sufficient pricing power to pass increased costs to customers. Yeti shares have declined about 25% since their 52-week high in December, and analysts expect a recovery, with a price target of $44 indicating 30% upside. The stock does not currently pay a dividend.

Martin Marietta Materials, a supplier of construction aggregates and materials, was cited for similar pricing power. Analysts said the company's ability to offset cost pressures through pricing makes it better equipped to handle tariff-driven inflation. Shares have fallen more than 20% since November, and the company offers a dividend yield of 0.65%. The average price target of $625 implies more than 25% potential upside. Martin Marietta also holds an overweight rating from Wall Street.

All three companies were highlighted in the Morgan Stanley report as relatively strong options in a deteriorating trade landscape.

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