3 Ways to Play the Iran Nuclear Deal

iran-nuclear-dealIran has finally come around.
The deal that Iran and the West struck, which includes the U.S. and five other countries, is truly a landmark agreement. Under the terms of the unfinalized deal, Iran would get much-needed relief from economic sanctions in return for scaling back its nuclear program.
To start, there’s been a lot said about the effect the sanctions will have on oil prices. For example, both Exxon Mobil (NYSE: XOM) and Total SA (NYSE: TOT) operated in Iran before the sanctions. These companies are looking forward to re-accessing the low-cost production Iranian oil fields. That means more oil will come to market.
With the global supply surplus of oil is the focus, West Texas Intermediate (WTI) crude oil prices has fallen nearly 20% over the last month, back down around $50 a barrel.
But the bigger and more underrated  catalyst related to the sanction relief will be that the people of Iran will be able to buy from U.S. and European companies. A big positive given Iran’s middle class and the fact that its are relatively well-off thanks to oil money.
However, they have been starved to some degree, with Iran’s oil exports falling drastically over the years due to the sanctions. Plus, creditors, like China, were not permitted to pay Iranian related debts while Iranian government and businessmen assets have been frozen in overseas accounts. .
It’s said there’s as much as $100 billion in Iranian cash trapped in foreign bank accounts. That means certain companies could see an impressive demand boost as this money is freed up.
Here are three non-energy stocks that will benefit from the Iranian deal as trade sanctions are lifted:

No. 1: Apple (NASDAQ: AAPL)

It seems rather strange, but the huge technology company has yet to tap into the Iranian market. It’s already in talks with potential distributors there.
The population of Iran is relatively young, which is good news for a smartphone and tablet maker. But also great for any company that’s selling technologically advanced products. The median age of Iranians is just 28  while China’s median age is 35 and the median age is 37 in the United States.
Granted, Apple is a $750 billion market cap company. Can a single Middle East country really move the needle for them? It’s tough to say, yet, the broader theme is still relevant and Apple is making a big effort to get into the country. Overall, there are a number of consumer goods companies will be getting their first chance to sell to Iran.

No. 2: Renault SA Regie NAT (OTC: RNSDF)

Autos are another thing that Iranian consumers have showed interest in. The best play here is the French automaker, Renault.
Renault is already sending spare parts into the country and recently rekindled talks with Iran to start up production of its cars there. It plans to have several models ready for sale by the end of the year, including some of Renault’s luxury brands.
Renault as an investment isn’t as straightforward as its peers in the industry; it holds interests in various automakers. For example, Renault owns large stakes in Nissan, Volvo, AvtoVaz and Daimler.

No. 3: Boeing (NYSE: BA)

Last but not least is aircraft manufacturers. Iran is on the record about wanting to upgrade its aviation industry, with plans to replace upwards of 400 jets over the next decade. Boeing is one of the world’s major aircraft manufacturers and it already has a leg up in Iran. It’s been selling aircraft manuals to Iranian airlines in hopes of forming partnerships.
The other beauty for Boeing is that 100 of the 400 new jets that Iran plans to order will go to Iran Air. Boeing and Iran Air were close partners before the Iranian Revolution, so they will be building on an existing foundation.
In the end, the Iran nuclear deal sets the stage for a new investment horizon in Iran. Assuming the deal is officially put in place and meets final approval, these opportunities could present themselves for key companies.

Wars will be fought over this

Over the last 15 years, one resource has caused more than 500 conflict-related events…11 of which have turned violent. What’s more, the British non-profit International Alert estimates that there could be 46 conflicts within the next 10 years…all related to this scarce resource. And some of the wealthiest insiders—Warren Buffett, Goldman Sachs and JP Morgan—are moving to profit from it right now. Go here to get the full story.

To top