Nvidia has had a 4.7% tax rate and average pretax profit of $4.8 billion. Here, a cryptocurrency mining rig is equipped with Nvidia Geforce GPU at the Thailand Crypto Expo 2022.
Andre Malerba/Bloomberg
Democrats proposed lifting the corporate tax rate to help fund their climate and healthcare package, and if the tax remains part of the deal companies—specifically larger ones—could take a hit.
The original proposal included a plan to raise revenue through a 15% minimum corporate tax rate. That could be modified, though higher taxes on companies is likely to remain a priority.
If the tax goes through, larger companies would bear the burden. The tax would apply to those that have averaged $1 billion of adjusted pretax profit in the past three years.
Strategists at UBS screened for companies that both fit that bill and have recently been paying less than 15% in cash taxes, and found 102. Of those, here are few that are particularly vulnerable.
Utility American Water Works Company (ticker: AWK) has recently enjoyed a cash tax rate of 0.1% and has brought in a pretax profit of $1.1 billion on average in the past three years. Its peer, Ameren (AEE), has had a 0.1% cash tax rate and pretax profit of $1.1 billion, as well.
Advanced Micro Devices (AMD) has had a 1% tax rate and average pretax profit of $1.8 billion. Nvidia (NVDA) has had a 4.7% tax rate and average pretax profit of $4.8 billion. Broadcom (AVG) has had a 6.8% tax rate and pretax profit of $6.8 billon.
Apollo Global Management (APO) has had a 5.1% tax rate and pretax profit $2.3 billion.
Ford Motor (F) has had a 4.3% tax rate and pretax profit of $4.93 billion. Tesla (TSLA) has had a 5.3% tax rate and pretax profit of $2.3 billion.
Amazon.com (AMZN) has had a 9% tax rate and pretax profit of $25.4 billion.
Salesforce (CRM) has had a 3.1% tax rate and pretax profit of $1.6 billion.
These companies are candidates to see lowered earnings from higher taxes.
