3 Stock Winners From the TACO Trade

By Jaimini Desai, Financial Writer + Reporter

June 11, 2025 6:17 AM UTC

A consistent pattern in President Trump’s trade war negotiation has been an aggressive first move, followed by a quick retreat to a softer stance.

In fact, many traders on Wall Street have dubbed this the ‘TACO’ trade (Trump Always Chickens Out). Those who are more favorably inclined towards President Trump attribute this to his typical ‘Art of the Deal’ strategy which entails starting a negotiation with a big initial ask.

Now let’s dig into some of the implications and then talk about 3 stocks that could benefit from this framework.

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A Return to the Pre-Liberation Day Status Quo

In many ways, we are back to where we started.

It seems like a long time ago, but markets were in a buoyant mood in the weeks between President Trump’s election and inauguration. Markets were breaking out to new, all-time highs with particular strength in speculative, high-growth areas like crypto, quantum computing, and AI.

The dominant narrative was that President Trump would boost economic growth through tax cuts and deregulation, while inflation would continue to ease, resulting in the Fed cutting rates in the second-half of the year, providing further fuel for asset prices. Overall, many expected a continuation of the policies and environment from 2017-2021.

Of course, the smooth ascent for asset prices came to a sharp halt in mid-February as markets realized that President Trump was determined to chart a much harsher course when it came to trade talks. Further, his goal was to actually reduce or eliminate trade deficits rather than strike more favorable trade deals. Equally important, he signaled a willingness to incur political and economic pain to reach his goals.

The markets took Trump seriously and literally as they dropped by nearly 20% in a manner of weeks. However, something spooked the administration during this period as they have been backtracking ever since.

And, it’s fair to say that we are essentially back to the conditions that prevailed prior to Liberation Day.

What’s Next?

These similarities include strength in frothy and speculative parts of the market, an economy that is slowing but continues to expand, and a central bank that is holding rates steady but prepared to cut if the economy were to materially weaken.

More importantly, the market is now taking President Trump seriously but not literally when it comes to his trade threats.

It’s also clear that President Trump does not have as much leverage in trade negotiations as he initially believed. He has slim majorities in Congress and already some of his allies have been alienated including fiscal conservatives like Elon Musk, Rand Paul, and Thomas Massie. He will have to save his political capital for getting his tax cuts passed in Congress.

Voters will hold him responsible if the economy weakens. Additionally, the flirtation with systemic risk in early April due to a faltering bond market seems to have sufficiently scared the administration.

Given this state of affairs, it’s clear how the incentives are aligned for President Trump. While he certainly doesn’t enjoy hearing about it, the TACO trade framework will prevail. 3 stocks that should thrive as the market reverts to its pre-Liberation Day status are Netease (NTES), Up Fintech (TIGR), and GE Healthcare Technologies (GEHC).

1. Netease (NTES)

Here we have a Chinese online gaming, streaming, and content provider — the second-largest online gaming company in China and counts well over a billion users across all of its services.

Like many Chinese tech stocks, NTES should benefit from a trade deal between the US and China as it would ease regulatory strains, enhance its offering of games, and lead to an increase in investor appetites for Chinese stocks.

Currently, NTES trades at a forward P/E of 14.8 while also expecting earnings growth of 17% in the coming year. So far this year, analysts have increased their expectations for 2026 EPS by 15%. Wall Street analysts are also bullish on NTES as 4 out of 5 analysts covering the stock have a Strong Buy rating.

The Zen Ratings are also bullish on the stock as it has a Strong Buy (A) rating. A-rated stocks have an average annual performance of 32.5% which beats the S&P 500’s average annual gain of 10.8%.

2. Up Fintech Holding (TIGR)

This online brokerage caters primarily to Chinese investors, although it has been recently expanding to new countries. Many consider TIGR to be the Chinese version of Robinhood (HOOD).

There are many similarities including an appeal to younger investors and a mobile-first platform. It generates the bulk of its revenue through commissions, margin financing, and value-added offerings.

However, a major difference between the two is in their valuations. HOOD trades at a P/S multiple of 3.3, while HOOD has a P/S multiple of 19.7. A major factor in this is the uncertainty and headwinds surrounding Chinese stocks. A trade deal between the US and China would certainly remove this headwind and lead to a re-rating of Chinese stocks to be more in-line with US peers.

TIGR is rated a Buy (B) by the Zen Ratings. B-rated stocks have produced an average annual return of 19.5%. In terms of its Component Grades, TIGR is in the top 2% of all stocks in terms of Sentiment. Sentiment can be a leading indicator of performance as it encompasses factors like recent earnings surprises, analyst upgrades, short interest, and insider activity.

3. GE Healthcare Technologies (GEHC)

This medical technology and device company serves over a billion patients annually and has installed more than 4 million devices in over 160 countries. Major sources of revenue include imaging systems, ultrasound, and diagnostics.

GEHC dropped by more than 40% between mid-February and early-April. It’s negatively affected by increasing tensions between the US and China in multiple ways. Currently, China accounts for 13% of revenue. Additionally, the company relies on Chinese factories and parts for many of its products. Thus, the trade war is likely to impact GEHC through a decline in revenue and an increase in costs.

A trade deal would lead to relief and provide a catalyst for the stock. Given aging populations in most parts of the world, the company’s total market will continue to steadily expand. Additionally, spending on healthcare continues to make up an increasing share of total spending. Despite this favorable backdrop, GEHC is also fairly valued with a forward P/E of 15.5.