Some U. S. companies capitalizing on Brexit

The U. K.’ s vote to bail out on the European Union sent shock waves through global markets. But the actual blow hasn’t been nearly the hit on U. S. companies many feared, and some firms are even benefiting.

Over the past two weeks, 14 companies in the Standard & Poor’s 500 — including technology firm Autodesk, apparel maker PVH, HP and Estee Lauder — have talked about the Brexit event, and a few are not all that concerned.

Tiffany even said it’s helping its business. “We believe that the weakening of the pound has made London a more attractive tourist shopping destination,” Mark Aaron, Tiffany’s director of investor relations, told investors last week.

That’s far from the impact global investors were bracing for when the vote passed in June.

More than $ 3 trillion in stock market value was wiped out in the two- day sell- off after the June vote, which was the worst two- day paper loss in history, S& P Dow Jones Indices says.

Since that time, U. S. stocks have rallied to new highs. The MSCI United Kingdom index is down 17% since the Brexit vote, but the MSCI Germany index is up 2.7%, and the Brussels BEL 20 Index is up 1.5%.

“Brexit, schmexit,” Jason Pride, director of investment strategy at Glenmede, says in a note to clients. “The eurozone economy seems quite healthy two months after the U. K.’ s decision to leave the syndicate.”

Some U. S. companies have capitalized on the Brexit panic. Autodesk, which makes software used by companies to de- sign products, bought its company stock as it was beaten up in the sell- off. “We also increased our stock buyback in Q2 to $ 170 million in light of the dip in the stock caused by the temporary panic around the Brexit vote,” CEO Carl Bass said in an Aug. 25 call with investors.

Shares of Autodesk cratered 14% in the two days after the vote but are now up more than 35% from the panic lows.

PVH, the apparel maker behind brands such as Tommy Hilfiger, Calvin Klein and Izod, said the slowdown in its European business was “short- lived,” CEO Emanuel Chirico told investors Aug. 25 in an earnings call, and now it’s growing in the “high single digits.”

“Our U. K. business continues to show strong momentum,” he says.

HP, a global technology company, said that Brexit “was really a non- event,” according to Catherine Lesjak, chief financial officer, in an Aug. 24 call with investors. “We saw a very, very limited impact from Brexit.”

Investors know Brexit will take months, if not years, to unfold. But businesses seem optimistic that the diversity of global business will reduce any impact from a single country.

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