With the blizzard already bearing down on Philadelphia to Maine and parts of the Midwest on Tuesday, there may be all sorts of companies in focus across Wall Street.
But retailers that sell storm supplies like rock salt and boots such as Home Depot (HD) , Lowe's (LOW) and Walmart (WMT) , and apparel retailers like Macy's (M) , T.J. Maxx (TJX) and Nordstrom (JWN) , likely won't be the biggest winners when Stella settles in. The trophies for biggest winners could go to snowblower makers, manufacturers of power generators and natural gas producers.
At least a foot of snow is in the cards, according to the National Weather Service, but some places, like New York City could see an extra foot on top of that. The entire Northeast corridor of I-95 from Washington, D.C., to Boston may be in whiteout conditions. Winter storms have historically triggered a good deal of cleanup in their aftermath.
Winter storms caused an estimated $1 billion in insured losses in 2016, down from $3.5 billion in 2015, according to Munich Re. From 1996 to 2015, winter storms resulted in about $30 billion in insured catastrophe losses, or about $1.5 billion a year on average, according to Property Claim Services.
Here are some of the possible big winners from Stella.
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If you have a power generator, then checking Facebook (FB) during a possible snow-driven power outage is a cinch. One company that could see its fortunes soar even more than in recent quarters as a result is Generac (GNRC) , a maker of generators.
Generac's net sales increased 16.7% to $417.4 million during the fourth quarter of 2016, which included some $50 million of contribution from an acquisition. Domestic sales went up 4% to $340 million, which was primarily due to more sales of portable and home standby generators, partially offset by a continued decline in shipments of mobile products given ongoing weakness in the oil and gas spaces.
Natural gas may be keeping you cozy and heating your soup when the winds are whipping at 35 mph outside your door. Think of that warmth as a reminder to look into the companies supplying the fuel.
Not a bad idea anyway seeing as natural gas consumption has risen steadily since 1985, according to the U.S. Energy Information Administration. Last year, U.S. natural gas consumers stood at 68 million strong.
When the snow finally stops, you'll need to dig out.
No one is happier about that than the Toro Company (TTC) , a maker of snowblowers for consumers.
Most recently, Toro reported net earnings of $45 million, or 41 cents a share, on a net sales increase of 6% to $516 million for its first quarter ending Feb. 3. In the comparable fiscal 2016 period, the company delivered net earnings of $39 million, or 35 cents a share, on net sales of $486 million.
The company expects revenue growth for this year at 3% to 4%, and net earnings per share to be about $2.25 to $2.30. For the second quarter, the company expects net earnings to be about $1 a share. Those projections could prove conservative if Stella wreaks havoc on driveways up and down the East Coast.
Now you're really getting into the ice, snow and slush of it all. And for that you need snow shovels, scrapers and rock salt.
Who's been stocking that all winter in anticipation of just such an event? Home Depot, Lowe's and Walmart.
Unfortunately, since we've had such a warm winter, these retailers may have moved all their winter stock to make room for spring flowers, sod and paint supplies. Hence, they may not be the biggest winners from Stella.
No matter. Their stocks warrant another look. On Feb. 21, Home Depot reported sales of $22 billion for the fourth quarter of fiscal 2016, a nearly 6% increase from the fourth quarter of fiscal 2015. Comparable store sales for the fourth quarter of fiscal 2016 gained 5.8%, and same-store sales for U.S. locations up 6.3%. N
For the fiscal year ended Feb. 3, Lowe's reported net earnings of $3.1 billion and diluted earnings per share at $3.47, compared to net earnings of $2.5 billion and diluted earnings per share of $2.73 in fiscal 2015.
For Walmart in the fourth quarter, total revenue was at $131 billion, an increase of 1%. Excluding currency, total revenue was $134 billion, an increase of 3%. Walmart U.S. same-store sales increased 1.8%, driven by a traffic increase of 1.4%.
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