Barrack Obama and his cabinet have promised to move the United States in a new direction with respect to; healthcare costs, energy, education & international diplomacy. Companies with innovative ideas and leadership are poised to benefit from the resources that will be dedicated to industries dedicated to solving these problems.
The pharmaceutical and biotechnology industries face significant challenges as a result of patent expirations, dwindling pipelines, tougher regulatory oversight and the ever-increasing costs of research and development. Generic drug manufacturers, by virtue of their business models, are well positioned to take advantage of the opportunities that will be created as blockbuster branded drugs come off patent.
Companies such as Teva Pharmaceuticals [TEVA] and Mylan laboratories [MYL] will benefit from the trend towards lower drug prices. Health management organizations, such as MedcoHealth Solutions Inc [MHS] that manage healthcare costs will also benefit from the new administrations efforts to lowering healthcare costs.
The exploration of renewable energy sources continues to resonate as a force for the future in the U.S. Environmental concerns, the economic impact of fossil fuel prices and the quest for energy independence from Middle Eastern oil are drivers for change. Many companies are researching different forms of renewable energy, including: solar, wind, geothermal, wave and biofuels.
Evergreen Energy [EEE], uses heat and pressure to create more efficient coal. Suncor Energy Inc [SU], is a company that converts bitumen to refinery feedstock and diesel fuel. First Solar, Inc. [FSLR], utilizes cadmium telluride semiconductor material to convert sunlight into electricity. Raser Technologies, Inc [RZ], is working on developing geothermal electric power generating plants and Pacific Ethanol [PEIX], produces and sells ethanol to refineries and distribution companies.
Tertiary education costs in the United States, are amongst the highest in the developed world. Many families struggle with the thought of how they will educate their kids and how much debt their kids will have once they graduate. Educational institutions that are creating innovative ways of making college education more accessible and affordable to the larger populace will benefit from the move towards lower and more affordable college tuitions.
Distant learning companies, such as Apollo group inc. which runs The University of Phoenix, Institute for Professional Development (IPD), The College for Financial Planning Institutes Corporation (CFP) and Western International University, Inc. and Strayer Educations inc. [STRA], which offers educational experiences both in-class and online at affordable prices, are poised to benefit from the need for lower college costs.
Defense contractors, Lockheed Martin CP[LMT], Northrop Grumman Corp. [NOC] and Raytheon Co [RTN] are bound to continue to benefit from defense spending as a result of an increasingly unstable world. The new government will probably continue to focus on more mobile defense technologies and increased intelligence technologies. These defense companies have a long history of success and I anticipate them continuing in their very rich tradition.