• Earnings of consumer companies with high exposure to China could be hurt by Trump’s trade policies, UBS says.
• Best Buy, Five Below and Wayfair are particularly at risk, analysts said.
• Trump proposed a 60 percent tariff on goods from China.

Donald Trump’s proposal for tough tariffs on goods from China could hit some retailers’ earnings, UBS analysts said.

The bank noted in a note that many U.S.-listed stocks — Best Buy, Five Below and Wayfair — are heavily exposed to Trump’s proposed trade policy.

“The tariffs are likely to have a significant negative impact on many of these retailers, at least in the short term. While their long-term effects are uncertain, we believe this is more likely to lead to mispricing, at least temporarily.” some of these stocks,” analysts said in a note on Monday.

“We think the overhang in names like Five Below, Best Buy and Wayfair is significant right now,” they added.

Analysts say that if these retailers absorb 5% of the increase in the cost of goods associated with a potential tariff, they would each experience a double-digit decline in earnings; Analysts said Five Below would see a 15% decline, Best Buy would see a 26% loss, and Wayfair could see its earnings decline more than 40%.

Analysts’ predictions come as Donald Trump and Kamala Harris are in fierce competition in the polls. The former president proposed a 20 percent tax across the board on imports; 60% tariffs In products coming from China. Five Below, Best Buy, and Wayfair each have high exposure to goods from China.

But that’s not all bad news for these stocks. Analysts said historical trends show retailers often find ways to adapt, and even those stocks have unique circumstances that could protect them from potential gains.

Analysts say that even if Five Below raises prices, for example, it can still offer more value than its competitors, while Wayfair’s sellers can pass it on to consumers in the form of higher prices rather than assuming the tariffs themselves.

Analysts say there’s a possibility that market prices for consumer electronics could simply be adjusted at Best Buy, protecting the retailer from bearing the brunt of the tariffs independently.

Stocks may see some upside as the situation becomes clearer.

“There may be selective opportunities to use this uncertainty as a chance to accumulate shares of some of these names as fear reaches its peak,” the analysts said, adding: “As the situation gains more clarity, these stocks will also likely rise from having more resolution on the situation.” profit will be made.”

High customs duties imposed on China in the past During Trump’s first term This has led to higher prices in categories subject to tariffs, possibly contributing to a slowdown in consumer spending, the report said.