Catch up on the top industries and stocks that were impacted, or were predicted to be impacted, by the comments, actions and policies of President Trump and his administration with this weekly recap compiled by The Fly:
1. TAX REFORM: On Thursday, House Republicans released the long-awaited tax bill that seeks to simplify the tax code and reduce corporate rates. The “Tax Cuts and Jobs Act” wants to reduce the number of tax brackets from seven to four, maintaining the top marginal rate at 39.6%, and almost double the standard deduction, according to ABC News. The bill also would permanently reduce the U.S. corporate tax rate from 35% to 20%, the report noted.
2. HOMEBUILDERS: Several names in the homebuilding space were under pressure on Thursday after the Republican tax plan proposed capping the mortgage interest tax deduction to new mortgages of $500,000 or less. Presently, Americans can deduct interest on mortgages of up to $1M from their income. Publicly traded homebuilders include Beazer Homes (BZH), D.R. Horton (DHI), Hovnanian (HOV), KB Home (KBH), Lennar (LEN), M.D.C. Holdings (MDC), CalAtlantic (CAA), PulteGroup (PHM) and Toll Brothers (TOL).
3. RENEWABLE ENERGY: B. Riley FBR analyst Benjamin Salisbury called the House tax reform proposal a “mixed bag” for renewable energy credits, noting that it would end the tax credit for commercial-scale solar projects after 2027, reduce the available wind tax credit and extend the orphaned tax credits, including fuel cells. The plan is still being negotiated and Salisbury sees a 30%-40% probability that Congress can pass a tax cut mirroring the recent GOP blueprint and a 55%-65% chance they could pass a scaled-down version. Publicly traded companies in the solar space include Canadian Solar (CSIQ), First Solar (FSLR), JA Solar (JASO), SunPower (SPWR), Trina Solar (TSL) and Yingli Green Energy (YGE).
4. PLUG POWER: Following the Republican tax bill announcement, Plug Power (PLUG) said in a blog post that, “Included in the bill is a provision that would reinstate the Fuel Cell Investment Tax Credit. We applaud the Committee for addressing the market disparity that was created in 2015. […] As we await passage in the House and then turn to the Senate, we are confident that our champions in both houses will keep fighting to get this done and restore parity for our growing industry here in the United States helping protect and grow good paying American manufacturing and service jobs.”
