Public Companies Exit Russia: Aftermath

The list of foreign companies – many of them public – who have announced they are ceasing, suspending, or downgrading business operations in Russia is long and growing.

Here is the list of those companies, along with the industries they represent:

Consumer Goods and Retail –

  1. Unilever.
  2. Ikea.
  3. TJX.
  4. H&M.
  5. Canada Goose.
  6. Adidas.
  7. Philip Morris.
  8. Fast Retailing.

Energy –

  1. Shell.
  2. BP.
  3. Exxon Mobil.

Finance –

  1. American Express, Mastercard, and Visa cards issued by Russian banks will not work in other countries, and cards issued elsewhere will not work for purchases in Russia.
  2. Goldman Sachs.
  3. Citigroup.
  4. The Big Four accounting firms — Deloitte, E&Y, KPMG, and PwC — are pulling out of the country.
  5. Bain.
  6. McKinsey & Company.
  7. Boston Consulting Group.
  8. Western Union.

Food –

  1. McDonald’s.
  2. Starbucks.
  3. PepsiCo.
  4. Yum Brands.
  5. Restaurant Brands International.
  6. Little Caesars.
  7. Heineken.
  8. Carlsberg.
  9. Mars.

Media –

  1. Netflix.
  2. The Walt Disney Company, Sony, and Warner Bros. paused the release of movies.

Tech –

  1. Amazon Web Services.
  2. Google.
  3. Microsoft and Apple paused sales. IBM suspended business.
  4. Cogent and Lumen, which provide so-called backbone internet services, cut off access.
  5. Uber.
  6. Sony.

Travel and Logistics –

  1. UPS, FedEx, and DHL have suspended shipments to and operations within Russia and Belarus.
  2. Airbus and Boeing.
  3. American Airlines, Delta Air Lines, and United Airlines.
  4. Amadeus and Sabre.
  5. Hyatt and Hilton.

Manufacturing –

  1. Caterpillar.
  2. Hitachi.

The impact on the shareholders of these companies has been immediate as share prices have dropped in reaction to the expected drop in revenue because Russia is not an insignificant market on the world stage.

It’s not just the stocks of the companies exiting Russia that are dropping. The stock market as a whole has dropped this week on news of the continued exits of international companies from Russia and the continued conflict on the ground.

Should the stocks of unrelated companies pay the price for a conflict halfway around the world?

Common sense says no, but public investors have never operated with common sense in the public markets where herd mentality and the fear of missing out (FOMO) rule investment decisions.

Even as the stock market reels from the economic aftershocks of the business exodus from Russia, wise investors at home are insulated. How?

​​By investing in illiquid assets such as commercial real estate (CRE) and in private startup companies (private equity and venture capital) that offer products or services insulated from macroeconomic shocks, smart investors can insulate their portfolios from wild market fluctuations plaguing the stock and crypto markets currently.

In addition to protecting the values of their portfolios from market downturns, smart investors are insulated in another way that often gets overlooked – the loss of income.

What happens when investors of public stocks that tanking lose their jobs? ​​Liquidating their assets can only go so far.

​​What happens to investors in cash-flowing private assets like real estate and private companies lose their jobs? They can rely on the passive income from these companies to cushion both job and income loss.

The loss of revenue from public companies exiting Russia affects the shareholders of these companies directly and of all shareholders market wide because of the perception of economic troubles ahead.

However, there is one group of investors not affected by the events in Ukraine and Russia. This group of investors are the smart investors who invested in alternatives to Wall Street.

​​By investing in cash-flowing alternative assets like real estate and private companies, these investors protected the values of their investments and secured passive income streams capable of sustaining their investors through any international conflict, economic turmoil, or even job loss.