Beware of these stocks in your portfolio with the biggest China risks as Covid protests erupt
A wave of unrest in China could spell trouble for investors holding stocks with sizeable chunks of revenue exposed to the country. Protests erupted across China over the weekend as citizens pushed back against the country’s strict and prolonged zero-Covid protocols . While the shockwaves are just beginning to ripple, a report from Bloomberg said Apple could suffer a shortfall of 6 million iPhone Pro units due to unrest at a Foxconn factory in China. Against this uncertain backdrop, CNBC Pro used FactSet data to screen for stocks in the S & P 500 that have more than 20% revenue exposure to China and could potentially suffer from the turmoil gripping the country. Here are some of the stocks we found: Tesla is the largest company on the list by market capitalization, with more than a quarter of its revenues exposed to China. Covid-19 lockdowns and restrictions in China have temporarily halted or limited production at the company’s Shanghai factory this year. Despite tumbling about 48% in 2022 amid the market’s tech sell-off, shares could rally nearly 59% from Friday’s close based on the consensus price target. Chemicals company DuPont de Nemours is also on the list. About 23.5% of the company’s revenues are exposed to China. The shares have toppled about 12% since the start of the year as of Friday’s close, but are due to rally nearly 11%, according to consensus estimates via FactSet. Another stock in our screen is elevator manufacturer Otis Worldwide , with a little over 20% of revenues exposed to the country. About 36% of analysts say the stock is a buy, with the consensus price target suggesting another 1.3% fall from Friday’s closing price after it slumped nearly 10% this year. Many semiconductor stocks such as Intel , Nvidia and Advanced Micro Devices also made the list — including Qualcomm , with the highest revenue exposure to China on the list. While many of these companies sell chips to manufacturers to use in products such as phones created in China, these products ultimately end up being sold back in the United States, blurring the line on what their end markets are. Estee Lauder , Cboe Global Markets , auto suppliers Aptiv and BorgWarner , and Corning , which is widely known for providing popular glass used in smartphones and tablets, were also included in the screen.
