Clean Harbors Needs Another Disaster

NEW YORK ( TheStreet) -- Although Clean Harbors ( CLH) has not benefited from world conflict, I do recall Alan McKim, the company's CEO, describing the 2010 BP ( BP) oil spill by saying, "It's like a war zone." In many respects, this was an accurate depiction. While the initial rig explosion, which caused the spill, resulted in (only) 11 reported deaths, let's not forget that 8,000 animals lost their lives as more than 200 million gallons of crude oil made its way across 16,000 total miles.

No doubt this was an unfortunate disaster for (among others) the residents of Louisiana and Mississippi. It was, on the other hand, a great opportunity for Clean Harbors, which was contracted to contain the massive spill from spreading through the Gulf of Mexico. Investors wasted no time speculating that "BP's trash" would be Clean Harbors' treasure. They guessed correctly. In fact, in the two months after the April 20, 2010, spill, shares of Clean Harbors soared more than 30%.

Fast-forward two years later, Hurricane Sandy, a category 3 storm at its peak, emerged. Here too, the term "war zone" seems appropriate to describe the destructive aftermath, which left 286 people dead, while causing close to $70 billion in damages to the entire Eastern seaboard. The storm was so severe that it actually shut down the stock market. But Clean Harbors was open for business.

As with the BP spill, Sandy was an unfortunate disaster that couldn't have come at a better time for the Clean Harbors, which "cleaned up" pretty well both in its actually cleanup efforts and in the stock market. TheStreet's Jim Cramer, on his popular CNBC show "Mad Money", correctly predicted Clean Harbors' exploitable advantage. Because of Sandy, the stock went on to gain 27% in a span of six trading days as Sandy's brutal impact began to emerge out of New Jersey and New York.

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