4 stocks that could benefit from Joe Hockey's small business stimulus plan

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The Treasurer has given small business spending a shot in the arm with his accelerated depreciation allowance and company tax cut which allows small business to “immediately deduct each asset costing under $20,000,” between now and June 30 2017.

That should ignite a wave of business investment and spending in the domestic economy and that means that other small businesses should benefit, but so also should a handful of Australian listed companies likely to be the natural recipients of this new business spending.

Here are four stocks that could get a big lift in sales once small business figures out how and what it wants to spend on.

The usual disclaimer: this is general information only, and shouldn’t be taken as investment advice.

Wesfarmers

ASX.com – Wesfarmers and the ASX 200

Wesfarmers is probably not your first choice as a listed Australian company that will benefit from Joe Hockey’s small business largesse.

But, mate of mine who has run his own businesses successfully in the UK and Australia for the best part of 25 years calls Wesfarmers subsidiary Officeworks “Bunnings for Businessmen.”

So while Wesfarmers itself won’t get the full impact of small business spending in this budget Officeworks certainly will.

Harvey Norman

ASX.com – Harvey Norman and ASX 200

Harvey Norman feels like the natural recipient of small business spending on all things IT, audio visual, furniture and any other related business spending.

The stock itself has done really well over the past 3 years and has outperformed the ASX200 recently after the index broke lower. While we aren’t forecasting the price of the stock itself, given the market clearly likes Harvey Norman it could do well in the weeks ahead. Certainly against the index.

JB HiFi

ASX.com – JB HiFi and ASX200

If you’re not buying your electronics at Harvey Norman there is a fair chance that our small business man or woman is going to walk out of a shop with one of JB HiFi’s ubiquitous yellow carry bags.

Like Harvey Norman, JB has been outperforming the ASX 200 lately and even though its relative valuation looks a bit stretched these Budget measures are likely to drive foot traffic and sales.

SCentre

ASX.com – SCentre and ASX200

Scentre is a slight sideways look at the listed company beneficiaries of the budget. But, if there is one thing this budget might be able to achieve it is improved confidence throughout the economy.

A huge percentage of total Australian employment is in small businesses. So, if small business owners and managers are more positive that will feed into a more positive work environment, positive feedback to staff, improved staffing, less fear of unemployment and stronger consumer confidence.

That should mean more foot traffic for mall operators like SCentre.

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