‘The reshoring craze is real’ — These companies should benefit, experts say

Published Fri, Dec 23 202210:01 AM ESTUpdated Thu, Dec 29 202210:17 AM EST

A lot has been said about reshoring, as companies look to bring manufacturing back to their home countries, particularly the U.S. Yet the ramp up is just getting started, experts believe, so the potential for the trend to drive stock values is not yet fully tapped. Reshoring is essentially companies returning operations to their original country from overseas. Supply chain security, a strong U.S. dollar and government incentives are among the reasons for the uptick, said Brian Belski, chief investment strategist at BMO Capital Markets. "The reshoring craze is real, especially as you continue to hear more and more about this general theme of deglobalization," he said. "It is a trend that is going to accelerate, especially in the first part of the year," he added. "The U.S. has learned its lesson during Covid and the lockdown and supply chains breaking." Reshoring and foreign direct investments are expected to create a record-breaking 350,000 U.S. jobs in 2022, according to the Reshoring Initiative , an advocacy group that tracks manufacturing jobs and foreign investment. Announcements by companies in the third quarter jumped 20% since the second quarter and 150% versus 2019, UBS analyst Chris Snyder wrote in a November note. He pointed to China's zero-Covid policy and the European energy crisis as two big drivers. "As China's zero-Covid has dragged on, they're shutting down, but we're fully reopening," Snyder told CNBC. "It's very difficult for a business or a multinational to have your point of supply and your point of demand be operating under very different playing fields, and that's made … supply chain very difficult to operate." CNBC Pro's 2023 sector by sector outlook Energy stocks had a blowout performance this year. In 2023, the outlook is more uncertain Health-care stocks are looking good for 2023 and not just because the sector is a 'safe haven' A long-overdue reality check for tech stocks has reset the bar for 2023 A weak economy will test consumers' wanderlust, but these stocks could prove resilient in 2023 EV stocks face another turbulent year, but some names are set for big gains, analysts say Some 87% of U.S. executives with operations in China plan to move production out of the country and about 70% of those are considering the U.S. for relaxation, according to a survey by UBS Evidence Lab. The online survey took place June 10 through July 7 and polled 450 senior executives across the U.S. Even Apple has been moving away from China, said tech investor Gene Munster. Of the 150 new manufacturing locations added in 2021, 79% are based outside of mainland China and 24 of those 150 are in the U.S., he said. "For Apple, it is more about getting out of China than it is about getting into the U.S.," said Munster, founder and managing partner at Loop Ventures. The com