3 Stocks to Sell on an Escalating Trade War
Last week, InvestorPlace Senior Analyst Louis Navellier decided to sell GigaCloud Technology Inc. (GCT) from his Accelerated Profits portfolio.
At first glance, the move seems surprising – like watching a chef throw out a perfectly cooked steak. GigaCloud was a fast-growing tech firm with a sizzling 30%-plus rate of return. Revenue surged 65% last year, and net profits rose to $125 million – a sixfold increase from two years before
However, GigaCloud specializes in large parcel shipping. It uses software to help pool small shipments into larger ones to save transportation costs, and its core business involves connecting Asian manufacturers with U.S. resellers.
That business is now in trouble.
On February 4, President Donald Trump imposed 10% tariffs on all goods imported from China – temporarily stopping all postal service shipments while the details were worked out. A month later, these duties were raised to 20%.
This will have a devastating effect on GigaCloud’s industry. Many Chinese exporters already run on razor-thin margins; a 20% surcharge on all goods will throttle their business, slashing demand for GigaCloud’s logistics services. Analysts have dropped GCT’s 2025 earnings estimates by 20% since January, and more pain is likely.
GigaCloud now scores a “D” rating in Louis’s Stock Grader (Navellier subscription required) – about as appealing as a one-star Yelp review.
The Los Angeles area-based logistics firm isn’t the only company that will struggle with rising U.S. tariffs. As Trump said in an interview with Fox News host Maria Bartiromo, America’s now going through a “period of transition” that could see “a little disruption.”
