Trade tensions have caused a noted drop in the S&P 500 in the first quarter of 2025. Tariffs threaten delicate supply chains and global trade inflows and tend to result in stock selloffs — with investors opting for safer assets.
That said, not all equities are equally exposed to this emerging risk. In the United States, businesses with a strong foothold in the domestic market, minimal reliance on imports or economic moats can weather the pressure of a global trade war. What’s more, 2025 might well be an opportune time for many of these companies as their competitors face strong headwinds.
There’s also the matter of sectors to consider. Traditional defensive sectors such as healthcare and utilities will, as they usually do, most likely provide a degree of stability — while tech stocks with competitive advantages are well-positioned to sidestep tariff impacts and provide outsized returns.
Let’s take a closer look at some companies that deserve a closer look as trade tensions continue to rise across the globe.
| Company Name (Ticker) | Sector | Year-to-Date Performance* | Analyst Consensus Rating** | Average 12-Month Price Forecast Upside | Learn More |
|---|---|---|---|---|---|
| Microsoft (MSFT) | Technology (Software) | -9.33% | Strong Buy | 29.04% | |
| Duke Energy (DUK) | Utilities | +9.86% | Moderate Buy | 6.22% | |
| CVS Health (CVS) | Healthcare | +48.48% | Strong Buy | 8.29% | |
| Texas Roadhouse (TXRH) | Consumer Services (Restaurants) | -1.46% | Moderate Buy | 6.75% | |
| Nucor (NUE) | Industrials (Steel) | +10.48% | Moderate Buy | 14.64% |
* Source: Google Finance, accurate as of March 10, 2025.
** Source: TipRanks, accurate as of March 10, 2025.
Sector: Technology (Software)
Microsoft has minimal reliance on physical imports of any kind — to the contrary, the brainchild of Bill Gates now draws most of its profits from high-margin software and cloud computing.(1) Better yet, these are mostly subscription-based services, which secure a steady stream of recurring revenue for the tech giant.
What’s more, Microsoft maintains a strong economic moat. Network effects — when value grows with more users — are at play, the cost of switching to another software provider is high, and there’s quite an entrenched customer base — in public and private sectors alike.(2) All of this combines to provide Microsoft with a level of pricing power that’s a rare sight in the high-growth tech sector.
Despite post-earnings selloffs, Microsoft has provided a string of standout earnings quarters as of late — with impressive growth metrics all around. The company’s cloud segment, particularly Azure, is expected to provide strong revenue growth as enterprise demand for artificial intelligence infrastructure shows no signs of slowing down.(3)
Often overlooked, yet still relevant, is the diversity of Microsoft’s revenue streams. Over the years, the company has expanded into enterprise tools with key acquisitions such as GitHub and LinkedIn — while its position in the gaming industry remains dominant with Xbox and Activision Blizzard under the company’s banner.
Investors should also keep in mind that Microsoft was also an early investor in OpenAI — and despite the recent advent of Chinese large language models (LLMs) such as DeepSeek, the company has a significant stake in what is still essentially the premier AI company in the world today.
Sector: Utilities
As one of the largest utility companies in the United States, Duke Energy happens to be quite naturally insulated from trade tensions.(4)
Unlike businesses that rely heavily on global supply chains or imported materials, the core business operations of utility stocks — delivering electricity and natural gas — are tied to domestic infrastructure. This gives them a stable, recession-resistant revenue stream that can’t be directly impacted by tariffs or geopolitical trade disruptions.
What’s more, energy isn’t exactly a discretionary category — whether tariffs cause resurgent inflation or a recession is entirely irrelevant to how Duke Energy makes its money. This resilience was evident in the company’s strong Q4 2024 financial results, with reported earnings-per-share (EPS) rising to $1.54 from $1.27 in Q4 2023 and adjusted EPS increasing to $1.66 from $1.51.(5)
Another key advantage is regulated pricing. This ensures consistent earnings and cash flow, even in volatile economic conditions.
The company’s strong regional monopoly in the southeastern US further strengthens its position — and the high cost of entry prevents new competitors from disrupting its market. Additionally, Duke offers an attractive dividend yield of 3.58%, making it a solid option for income-focused investors looking for defensive plays in an unpredictable trade environment.
Duke Energy’s long-term growth strategy revolves around its transition to renewable energy. The company has committed billions to expanding its solar, wind and battery storage projects to meet the growing demand for cleaner power. This shift positions Duke not just as a defensive stock but also as a long-term growth opportunity as the energy sector modernizes.
Moreover, electricity demand is expected to rise significantly due to the expansion of AI data centers, electric vehicles and cloud computing infrastructure.(6) These trends could boost Duke’s earnings, even as the broader economy faces tariff-related headwinds. With analysts maintaining a stable to bullish outlook, Duke remains a top utility play for investors seeking tariff-proof resilience in 2025.
Sector: Healthcare
CVS Health stands out as a strong defensive play, largely insulated from trade disruptions due to its domestic revenue base and essential healthcare services. In recent years, the company has expanded beyond retail pharmacy into primary care and digital health, reinforcing its competitive edge.(7)
A key move in this direction was the acquisition of Oak Street Health, a growing network of value-based primary care centers.(8) By integrating primary care, CVS is strengthening its vertical business model, increasing customer retention and positioning itself as a one-stop healthcare provider.
At the same time, CVS has been investing in digital healthcare. The company has enhanced its mobile app, introducing improved prescription management tools, telehealth services and cost transparency features. These efforts align with shifting consumer behavior and reinforce CVS’s role in the growing demand for digital healthcare solutions.
The company is also optimizing its physical presence. Moving away from its traditional retail-heavy format, CVS has been rolling out smaller, pharmacy-focused stores designed to prioritize its most profitable segments.
CVS’s core businesses — pharmacy, insurance and healthcare services — are expected to generate stable growth in 2025. The expansion into primary care could unlock new revenue streams while its digital initiatives help drive operational efficiencies and improve customer engagement.
Readers should keep in mind that the US population is aging and that healthcare costs are forecast to increase by 8% in 2025.(9) While broader market conditions remain uncertain, CVS remains a well-positioned healthcare stock for 2025 — one that offers both defensive stability and the potential for steady returns.
Sector: Consumer Services (Restaurants)
Texas Roadhouse is largely shielded from trade disruptions thanks to its domestic focus and sourcing strategy. Though it does source beef from Canada, the company sources most of its beef from US cattle ranches, reducing its exposure to global supply chain risks.(10)
The company has also built a strong brand presence and customer loyalty, consistently reporting impressive same-store sales growth and high average revenue per location.(11)
Rising food and labor costs remain challenges, especially with beef prices being a major expense. While Texas Roadhouse has historically managed inflationary pressures through strategic pricing adjustments and operational efficiencies, the company has acknowledged that there’s no perfect solution to rising costs.
Sector: Industrials (Steel)
Nucor is the largest steel producer in the US, making it one of the few industrial stocks that stand to benefit from tariffs.(12),(13)
Beyond tariffs, Nucor’s use of mini-mill technology allows for cost-efficient, flexible production. The company relies heavily on recycled scrap steel, reducing its dependence on raw material imports and insulating it from supply chain disruptions.
The steel industry tends to move in cycles, with demand fluctuating based on broader economic conditions. While tariffs on imported steel provide Nucor with a layer of protection against foreign competition, factors like interest rates, construction activity and the strength of the US dollar will still play a major role in determining demand.
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For investors, tariffs create both risks and opportunities. Sectors that rely on imported raw materials or components — such as automotive, consumer electronics and industrial manufacturing — face higher input costs and potential margin compression.(14)
On the other hand, industries with strong domestic supply chains and minimal reliance on foreign imports are more resilient and, in some cases, could see market share gains as imported alternatives become more expensive.
Diversification into tariff-resistant sectors has become increasingly important in this environment. Companies in utilities, healthcare and software technology tend to have stable revenue streams with little exposure to trade disputes. Meanwhile, select industrial firms — such as domestic steel producers — may actually benefit from protective trade policies.
Unlike hardware manufacturers that depend on imported components, software companies generate revenue from digital products and cloud-based services. These businesses face little exposure to tariffs on physical goods and often benefit from high margins and recurring revenue streams. Companies in enterprise software, cloud computing and cybersecurity are particularly well-positioned.
Electricity and natural gas providers operate within highly regulated domestic markets, making them one of the least affected sectors when it comes to trade policy. Utility companies generate consistent revenue, often through long-term contracts, and can pass rising costs onto consumers through rate adjustments. Their defensive nature makes them an attractive choice during periods of economic uncertainty.
Pharmaceuticals, healthcare services and insurance providers tend to have minimal exposure to trade restrictions, as demand for healthcare remains stable regardless of economic conditions. While certain medical equipment and drug ingredients are imported, large domestic healthcare firms have strong pricing power and established supply chains that help mitigate tariff risks.
Restaurants, retail chains and other service-based businesses that operate primarily within the US are generally less affected by global trade policies. Companies that rely on local supply chains and have strong brand loyalty can navigate rising costs more effectively than import-heavy retailers. The most resilient businesses in this category focus on essential or in-demand services rather than discretionary goods.
While no investment is completely immune to broader economic pressures, the unique challenges posed by tariffs can actually benefit a select few well-positioned businesses. Choosing a broker and investing in them before the trade war escalates further could lead to outsized gains or serve as a hedge against losses from other holdings in your portfolio.
No — tariffs are one (albeit important) factor in complex trade relations in an interconnected, global economy. Their far-reaching effects, which can easily shift macro conditions, will most likely have an effect across the board — but as we’ve outlined, certain assets tend to perform much better than others in such environments.
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