California Flood Winter
The idea
I'm betting this El Niño winter brings serious flooding to California, so I built a basket of the companies that profit from cleaning up after water, not insuring against it. It owns pump and backup power makers, equipment rental and cleanup crews, rebuild suppliers, road and flood repair engineers, and salvage and claims-data firms, while skipping insurers since they're the ones paying out. It's concentrated and tied to this one season, with a small cash reserve set aside to add if prices dip before the storms actually hit.
What it owns
- When water rises and power goes out, demand spikes for pumps to drain flooded areas and generators to restore electricity to homes and businesses. · Xylem Inc.It makes the large pumps and water handling gear that cities and contractors use to manage floodwater during coastal storm events., Generac Holdings Inc.It sells home and business generators that buyers purchase when storms cause prolonged power outages, making it sensitive to the duration and reach of grid failures., The Gorman-Rupp CompanyIt manufactures dewatering pumps that crews deploy into flooded basements, tunnels and construction sites, so coastal atmospheric rivers boost demand for this equipment., Franklin Electric Co., Inc.It manufactures pump systems for wells, sumps and water movement that homeowners and utilities replace after flooding damages existing equipment.22%
- Emergency response and restoration crews rent pumps, dryers, generators and heavy equipment, then hire specialists to dry out and repair water-damaged buildings. · United Rentals, Inc.It rents pumps, dryers, generators and heavy equipment to cleanup and repair crews responding to flood damage in California regions., FirstService CorporationIt owns restoration businesses that dry out and repair homes and buildings after water damage, with existing California property management operations positioned to capture flood work., Clean Harbors, Inc.It handles emergency cleanup when flooding spreads fuel, sewage and chemicals, so coastal storms that contaminate areas trigger paid emergency response services., Herc Holdings Inc.It rents emergency equipment like pumps, power generators and lighting that contractors obtain for disaster response, so major cleanup operations increase rental demand.22%
- After floodwaters recede, homeowners and contractors purchase flooring, lumber, drywall and other materials to repair and replace damaged structures and finishes. · The Home Depot, Inc.It sells drywall, fans, dehumidifiers and tools that homeowners and contractors buy to repair water-damaged interiors, creating a seasonal sales lift in affected regions., Lowe's Companies, Inc.It supplies the same rebuilding materials as competitors to homeowners and contractors, capturing a portion of repair spending driven by storm damage across its regions., Floor & Decor Holdings, Inc.It sells replacement flooring, and floors are typically the first casualty when water enters homes, driving replacement demand in affected areas., Builders FirstSource, Inc.It supplies lumber, framing and structural materials to contractors performing major repairs, so significant flood damage that requires rebuilding drives material orders.18%
- Storm damage to roads, levees and coastal defenses triggers reconstruction contracts, and governments fund new flood control infrastructure after disasters expose vulnerabilities. · Granite Construction IncorporatedIt builds roads and infrastructure, so washed-out highways and mudslides create emergency repair contracts within its operating regions., Vulcan Materials CompanyIt supplies gravel and crushed stone used to repair and rebuild roads and levees, so major storm damage to infrastructure lifts material demand., Tetra Tech, Inc.It provides disaster recovery and water engineering services, including assessment and planning work that follows federal disaster declarations and recovery spending., AECOMIt designs levees, seawalls and flood control projects that governments fund after coastal flooding exposes weaknesses in existing defenses.16%
- Flooded homes and vehicles generate insurance claims that require damage assessment and processing, and salvage companies profit by acquiring and reselling damaged assets. · Copart, Inc.It auctions vehicles that insurers declare a total loss, and flooded cars make up a significant portion of auction volume following major storms., Verisk Analytics, Inc.It supplies software that insurers use to estimate damage and process claims, so large claims volumes from major storms increase usage and revenue from its tools.12%
- Cash10%