Stocks pop when the Trump administration invests, but the gains often fade fast
- INTC
- USAR
President Trump often touts his administration’s investment in Intel (INTC) — specifically the outsized gains in the chipmaker’s share price since the deal was announced.
But the fortunes of more than a dozen other public companies in the US government’s growing portfolio tell a much less flattering story.
Stocks in other companies that have struck a deal with the Trump administration have tended to move in the opposite direction, often following a common trajectory: a significant bump around the formal announcement, high volatility afterward, and then gains often given back almost as quickly as they came.
Take USA Rare Earth (USAR): Yahoo Finance data shows the stock jumped over 80% in five trading days around the announcement of its deal with the government this January. But the stock gave up all those gains (and more) within weeks, ending Monday at $15.71 per share, far below post-deal highs above $30.
In fact, most of the companies are now in the red compared with those initial prices. A Yahoo Finance analysis shows that 14 of the 17 public companies that accepted government involvement ended this past week with share prices lower than the day after the deal was announced.
For investors who managed to front-run the government investments, the stocks are also often a losing proposition. Returns for 11 of the 17 companies, when compared to 10 trading days before the formal announcement, are lower now.
“It certainly looks like we’re seeing a sugar high,” noted Tad DeHaven, a policy analyst for the Cato Institute who has studied the government stakes and has been critical of the Trump administration’s approach.
“There looks to be a short-term benefit … but in the long term it comes down to fundamentals,” he said.
A potential warning for individual investors
The Trump administration has taken stakes in more than 30 companies, recently adding an oil drilling venture in Venezuela to its portfolio.
The investments include pieces of many private companies whose valuation trajectories aren’t yet clear. But the evidence from the public markets — where many of these companies are lagging their sector-wide trackers — could be a warning for investors looking to piggyback on government stakes.
The negative returns are even more pronounced given that two of the three companies whose stock is up are Intel and Nippon Steel (5401.T) — which gave the government a “golden share” with outsized voting rights but not an equity stake.
The third gainer since deal day is MP Materials (MP), a rare-earth magnetics company that secured a deal in July 2025.
