3 Stocks That Could Benefit If The US Dollar Stays Strong

With the Federal Reserve holding rates steady for now, dropping forward guidance, and keeping inflation control front and center, currency moves are back on the radar for many investors. A stronger US dollar can subtly reshape earnings for global companies, especially those with cross border costs and revenues. This article focuses on three large, financially solid stocks from our US Dollar Beneficiary Stocks screener that appear closely linked to the latest Fed backdrop and geopolitical tension. Across these picks, you will see how different business models could respond if the dollar stays firm or policy eventually tilts toward cuts.

Arko (ARKO)

Overview: Arko is a Richmond based convenience store and fuel retailer that operates thousands of sites across the United States, selling fuel, food, beverages, tobacco products and everyday essentials, while also supplying fuel on a wholesale basis and through fleet fueling programs.

Operations: Arko generates most of its revenue in the US, with about US$4.9b from GPMP fuel distribution, US$4.3b from retail stores, US$2.8b from wholesale fuel supply and US$0.5b from fleet fueling, partly offset by inter segment eliminations.

Market Cap: US$890m

Arko provides exposure to a strong US dollar through a business closely tied to the real economy, as imported inventory costs can ease when the currency is firm, while fuel margins and higher margin in store categories become more important. The company is working to improve profitability through dealerization, remodels and digital loyalty, even as fuel and merchandise volumes face pressure and earnings remain sensitive to interest costs. Recent quarterly results still showed a loss, and index removals plus significant insider selling indicate that this is not a low risk situation. For investors who want to understand whether the potential margin upside and earnings growth assumptions justify today’s valuation, Arko warrants closer analysis.

Arko’s dealerization push, remodel program and digital loyalty efforts could be masking where the real earnings power sits today, so review the 2 key rewards and 2 important warning signs (1 is major!)

Eagers Automotive (ASX:APE)

Overview: Eagers Automotive is a large vehicle retailer in Australia and New Zealand, selling new and used cars, arranging finance, and providing servicing, parts, and aftermarket products through its dealership network, while also owning property used by these dealerships.

Operations: Eagers Automotive generates most of its revenue from Car Retailing at about A$13.0b, with around A$60.7m from Property and a small offset from eliminations, supported by sales primarily in Australia and a smaller contribution from New Zealand.

Market Cap: A$6.1b

Eagers Automotive provides exposure to car demand and movements in the US dollar, as many imported vehicles are priced in US$. Cheaper import costs can support margins when currency movements are favourable. The company has grown earnings faster than the broader Australian market, is forecast for double digit revenue and profit growth, and has launched a sizeable buyback covering up to 10% of its shares. At the same time, a relatively high P/E, significant use of debt and exposure to shifts in dealer agreements, online sales and EV-related change mean the situation involves notable risks, which is why it may warrant closer inspection.

Eagers Automotive’s earnings, growth forecasts and fresh buyback could be telling a different story than the headline P/E suggests. Check the 3 key rewards and 2 important warning signs investors may be missing one crucial twist.

ATRenew (RERE)

Overview: ATRenew operates a recommerce platform for pre owned consumer electronics in China, sourcing used smartphones, laptops and other devices, refurbishing them, and reselling them through its own online platforms and other channels, while also helping third party merchants sell through its ecosystem.

Operations: ATRenew generates its revenue primarily from retail electronics sales, with about CN¥22.6b coming from this segment.

Market Cap: US$858m

ATRenew provides focused exposure to the rise of device recycling in China at a time when a firm US dollar can lower sourcing costs and support margins on any US dollar linked revenue streams. The company benefits from policy support for trade in programs and growing consumer comfort with secondhand devices, while recent results show stronger earnings and guidance that indicates double digit revenue growth expectations. At the same time, thin margins, heavy reliance on government subsidies and higher fixed costs from its store network leave little room for error if competition intensifies or policy support changes. For investors seeking exposure to this recommerce trend with careful attention to risk, ATRenew may warrant closer examination.

ATRenew’s accelerating recommerce push and policy support could be masking where future earnings really settle, so review the analyst forecasts for ATRenew before competition or subsidies shift the story in an unexpected way.

The three stocks highlighted here are just a starting point, and the full US Dollar Beneficiary Stocks screener surfaces 11 more large, financially solid companies that could have equally compelling currency and earnings stories tied to a firm US dollar. Use Simply Wall St to identify, analyze, and filter for the exact catalysts, balance sheet strength, and narrative drivers that matter most to you so you can focus on the highest conviction opportunities in this theme.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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