It's time to trade Hurricane Matthew on Friday, the last trading session of the week.
The fierce hurricane is currently a Category 3 storm with winds of 120 mph, according to the latest National Hurricane Center advisory. As of 5 a.m. EDT, Matthew was about 40 miles east/southeast of Cape Canaveral, Fla., and 90 miles southeast of Daytona Beach. Based on the latest projections, Matthew could make landfall in Florida as a Category 3 storm, or it could hug the coast and turn north before potentially coming back toward land.
The flooding and general chaos associated with the hurricane has sent Floridians out in droves to purchase generators, plywood, batteries and even emergency food ahead of the storm (see Instagram posts below). Meanwhile, the mere threat of Matthew's destruction has probably sent many in the Southeast out to retailers to prep for the worst.
To get a sense as to the possible financial windfalls for some of the companies that hawk storm merchandise, look no further than Superstorm Sandy, the last historic hurricane that pummeled the Northeast in October 2012. Like Sandy, Matthew is also a crippling Category 3 storm.
At home-improvement retailer Home Depot (HD) - Get Report , product categories at its Northeast stores that sold particularly well during Sandy were generators (same-store sales rose by a triple digit percentage in the fourth quarter, said the company at the time), plywood (same-store sales rose by a double-digit percentage), extension cords, water heaters and cleaning products.
Sales of products related to Sandy preparation and cleanup went onto tally about $242 million in the fourth quarter of 2012 for Home Depot, roughly $112 million higher than the sales the company realized from Hurricane Irene in the same period in 2012.
Home Depot rival Lowe's (LOW) - Get Report had a similar experience within its aisles. According to the company, it saw a "surge in demand" during Sandy that lifted its fourth quarter 2012 same-store sales by 0.7%.
One of the biggest winners from Sandy was generator maker Generac (GNRC) - Get Report . Sales of residential products such as portable and stand-by generators, and power washers, surged 28% in the fourth quarter of 2012.
The stock market embraced what was referred to back then as "Superstorm Sandy trades," buying shares of Home Depot, Lowe's and Generac ahead of their strong fourth-quarter sales numbers. From the time Hurricane Sandy formed in the Caribbean Sea on Oct. 22, 2012, to the end of the year, shares of Generac spiked 31%, Lowe's advanced 9.9% and Home Depot rose 0.2%.
Shares of all three already have started to perk up this time around, too. Over the last five sessions, Generac has gained 4.5%, Lowe's is up 0.4% and Home Depot has tacked on 0.2%.