My bookmarks

Pins are saved using cookies. Deleting them from your browser will delete your preferences.

Menu
News 

Alger on the money - Why tax repatriation matters

08 December 2017

Washington lawmakers are considering changes to the tax code that could result in a large amount of cash returning to the U.S. According to Goldman Sachs, nearly $1 trillion could be eligible for repatriation, allowing U.S.-based companies to deploy more money in even more productive ways at home. Why does this matter and where should investors look for investment opportunities?

  • Investors should consider that 85% of untaxed foreign money is held by Information Technologyand Health Care companies.
  • U.S. companies may be able to repatriate their post-tax funds at any time at no additional cost if a tax affects all untaxed overseas cash, regardless of when companies choose to repatriate funds.
  • In the absence of a time restriction, companies may strategically spend repatriated funds. During the last 12 months, S&P 500 companies with taxable overseas cash spent 58% of their cash outlays investing for growth (capex, research and development, mergers and acquisitions) and 42% returning cash to shareholders (share repurchases, dividends).1
  • Any manner in which repatriating companies spend their cash is likely to fuel earnings growth, which may lead to equity gains for Information Technology and Health Care businesses.

1 Goldman Sachs (2017) “Overseas Cash Repatriation Would Boost Shareholder Returns and Growth Investments.” US Equity Views.

> Download Alger on the Money, A view on the U.S. Market

La Française Group provides access to the expertise of a number of asset management companies around the world. To provide you with the most relevant information, we have developed an interface to present the full range of products available for your investor profile and country of residence.
Present yourself
1
Country
2
Language
3
Profile
Your country of residence
Your language
Your profile
<p class="new-disclaimer__legal-notice">Before consulting this website, for your protection and in your interest, please read the “<a href="en/legal-notice/" target="_blank">disclaimer</a>” and “<a href="en/regulatory-information/" target="_blank">current regulations</a>” carefully. This information explains certain legal and regulatory restrictions which apply to individual and professional investors according to local law. By accessing this site, in my non-professional or professional capacity, I acknowledge that I have read and accept the terms and conditions of use. Pursuant to the application of the European Markets in Financial Instruments Directive (“MiFID”), please state to which category of investor you belong&nbsp;:</p>
<p class="new-disclaimer__legal-notice">Before consulting this website, for your protection and in your interest, please read the “<a href="en/legal-notice/" target="_blank">disclaimer</a>” and “<a href="en/regulatory-information/" target="_blank">current regulations</a>” carefully. This information explains certain legal and regulatory restrictions which apply to individual and professional investors according to local law. By accessing this site, in my non-professional or professional capacity, I acknowledge that I have read and accept the terms and conditions of use. Pursuant to the application of the European Markets in Financial Instruments Directive (“MiFID”), please state to which category of investor you belong&nbsp;:</p>
By continuing browsing on this website, you accept the use of cookies and other tracing devices s as to allow you to receive information suited to your profile, facilitate information sharing on social networks, guarantee the best browsing experience possible and to create statistics. To find out more, we invite you to consult our Privacy and Cookies policy. Find out more.