JPMorgan: These 11 Companies Will Get Crushed When The Government Cuts Back

Joint Select Committee on Deficit Debt Reduction John Kerry

Photo: AP Photo/J. Scott Applewhite

Cutting $1.5 trillion from the nation’s budget over 10 years is proving no easy feat. In private, the Joint Select Committee on Deficit Reduction has been hammering out details of its coming bipartisan recommendations to little avail.J.P. Morgan sees education, electronic equipment and aerospace and defence firms taking the brunt of the spending hit. According to their research, $280 billion in annual sales are at risk at publicly traded companies on the S&P 500.

If the Supercommittee is unable to come to a consensus before its November deadline, automatic cuts of $1.2 trillion will take effect. This trigger is acting as an impetus for the 12 leaders to come to some agreement.

#11: Coventry Health Care Inc. (NYSE: CVH)

per cent of Sales to Gov't: 57%

Market Cap: $4.3 billion

Sub-Industry: Managed Health Care

Source: J.P. Morgan Chase & Co.

#10: DaVita Inc. (NYSE: DVA)

per cent of Sales to Gov't: 66%

Market Cap: $4.3 billion

Sub-Industry: Health Care Services

Source: J.P. Morgan Chase & Co.

#9: Harris Corp. (NYSE: HRS)

per cent of Sales to Gov't: 72%

Market Cap: $4.2 billion

Sub-Industry: Communications Equipment

Source: J.P. Morgan Chase & Co.

#8: General Dynamics Corp. (NYSE: GD)

per cent of Sales to Gov't: 72%

Market Cap: $20.1 billion

Sub-Industry: Aerospace & defence

Source: J.P. Morgan Chase & Co.

#7: Humana Inc. (NYSE: HUM)

per cent of Sales to Gov't: 76%

Market Cap: $12.7 billion

Sub-Industry: Managed Health Care

Source: J.P. Morgan Chase & Co.

#6: Apollo Group Inc. (Nasdaq: APOL)

per cent of Sales to Gov't: 80%

Market Cap: $5.8 billion

Sub-Industry: Education Services

Source: J.P. Morgan Chase & Co.

#5: L-3 Communications Holdings Inc. (NYSE: LLL)

per cent of Sales to Gov't: 83%

Market Cap: $6.5 billion

Sub-Industry: Aerospace & defence

Source: J.P. Morgan Chase & Co.

#4: Lockheed Martin Corp.

per cent of Sales to Gov't: 84%

Market Cap: $24.6 billion

Sub-Industry: Aerospace & defence

Source: J.P. Morgan Chase & Co.

#3: Raytheon Co. (NYSE: RTN)

per cent of Sales to Gov't: 88%

Market Cap: $14.2 billion

Sub-Industry: Aerospace & defence

Source: J.P. Morgan Chase & Co.

#2: SAIC Inc. (NYSE: SAI)

per cent of Sales to Gov't: 89%

Market Cap: $4.1 billion

Sub-Industry: IT Consulting & Other Services

Source: J.P. Morgan Chase & Co.

#1: Northrop Grumman Corp. (NYSE: NOC)

per cent of Sales to Gov't: 92%

Market Cap: $14.4 billion

Sub-Industry: Aerospace & defence

Source: J.P. Morgan Chase & Co.

Top Consumer Plays


If you're hoping to get out of these mostly aerospace and defence plays, UBS has a list of consumer staples that might perform well -- even during government cuts.
Click here to see the list >

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