Trump’s Stock Picks Are Crushing the Market: Are These 4 Stocks a Buy?

Key Points

• President Trump’s stocks have averaged 100% gains since the government took a stake in them, but such involvement may distort corporate priorities.

• The potential for a new trade war with China might change the calculus on some of these stocks.

• These stocks are surging on their government deals, but euphoria alone won’t sustain gains.

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President Trump has taken an unprecedented step by directing the federal government to acquire equity stakes in publicly traded companies. This move aims to strengthen domestic supply chains for semiconductors and critical minerals amid geopolitical tensions.

While the intent to secure U.S. interests is clear, such interventions raise concerns. Government ownership may distort corporate decision-making, prioritize political goals over shareholder value, and invite regulatory scrutiny. It also blurs lines between public and private sectors, potentially undermining market efficiency.

Yet, the “Trump portfolio” has delivered impressive results, averaging a 100% gain since the government acquired its respective stakes, driven largely by market euphoria over the vote of confidence. Much of this surge reflects speculative hype rather than fundamentals. As gains cool and risks like trade disputes grow, are these stocks still worth buying?

MP Materials (MP)

MP Materials (NYSE:MP) was the first company Trump bought, securing a 15% stake for the Pentagon on July 10 through $400 million in convertible preferred stock plus warrants. It made the federal government its largest shareholder. The deal funds rare earth magnet production at Mountain Pass, California, critical for EVs and defense technology.

MP stock has surged 160.9% from $30 to over $78 per share today, boosted by the deal and Trump’s new 100% tariff threat on China, after Beijing tightened rare earth export controls. The announcement made via a Truth Social post, capped a near-10% weekly jump.

Is it a buy? Yes, it remains attractive. China’s 90% supply dominance and trade tensions create a moat for MP Materials. Analysts had a $78 per share price target, supported by EBITDA growth from new facilities, but the new tariff regime could boost those targets higher.

Despite lithium volatility risks, government alignment strengthens its case, and MP remains a buy for tariff-driven upside.

Intel (INTC)

Chipmaker Intel (NASDAQ:INTC) was Trump’s second acquisition, finalized on August 22, with the government acquiring a 10% stake. It consisted of 433.3 million shares at $20.47 each — some $8.9 billion — that saw the conversion of CHIPS Act and Department of Defense grants into equity to fund U.S. chip fabrication. The goal is to reduce reliance on foreign semiconductors.

Since the acquisition, Intel’s stock has risen 46.7%, trading near $36, up from the under-$25 purchase price. This gain reflects optimism for domestic foundries, though competition from Advanced Micro Devices (NASDAQ:AMD) and Nvidia (NASDAQ:NVDA) remains fierce. Execution risks persist due to losses in Intel’s core business.

Is it a buy? With a forward P/E of 54, Intel is pricey, but still offers value as it has become the go-to stock for foundry partners. Nvidia invested $5 billion into Intel while Microsoft (NASDAQ:MSFT) will leverage Intel’s 18A process technology to have it manufacture custom AI chips. Previously, SoftBank invested $2 billion for an equity position.

Government backing provides stability, yet it may hinder market agility. Long-term investors should hold for upside, while short-term traders might wait for a dip.

Lithium Americas (LAC)

Trump kicked off October by taking a 5% stake in Lithium Americas (NYSE:LAC) as well as a 5% position in the Thacker Pass joint venture via no-cost warrants tied to a $2.26 billion DOE loan. The deal supports Nevada’s lithium mine for electric vehicle batteries, targeting production by 2027.

The stock has gained only 6.4% in the 10 days since the deal, as it still labors under an 80% drop in lithium prices since 2022, which has dampened enthusiasm despite government support.

Is it a buy? It’s a cautious yes. Thacker Pass holds 20% of U.S. reserves, and DOE funding ensures progress, but EV demand is waning, especially after the end of EV tax credits. Ford (NYSE:F) recently said it expects its EV sales to be cut in half as a result.

At a price-to-book of 1.7, LAC looks undervalued, but investors should wait for lithium prices to recover before buying.

Trilogy Metals (TMQ)

Trilogy Metals (NYSEAMERICAN:TMQ) finalized a 10% Defense Dept. stake on October 6, through a $35.6 million private placement of 8.2 million units at $2.17 Canadian, including warrants for 7.5% more. The deal funds Alaska’s Ambler copper and zinc exploration for green technology.

The stock has soared 183.7% from $2.09 to $5.93 per share, but had been as high as $7.98 on Oct. 7, after the deal was announced.

Is it a buy? Only the most risk-tolerant speculators should consider a position, and even then it’s doubtful. Trilogy not only is a loss-generating stock, it also has no revenue. Ambler’s potential is significant, but permitting and logistics delays limit near-term output. BMO Capital Markets just downgraded the stock to Market Perform with a $5.50 per share target, suggesting TMQ is a high-risk, high-reward opportunity best suited for aggressive investors.

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