One of the best ways to multiply your wealth every summer is by picking up some of the top hurricane stocks to buy.
With Hurricane Beryl, we were again reminded of how powerful and destructive hurricanes can be. We’re also reminded of how important it is to get out of their way and safeguard property, as we saw with Texas and Jamaica these. last few days.
Unfortunately, we could see many more this season.
According to The Weather Channel, the 2024 hurricane season could be one of the most active on record. “The outlook calls for 24 named storms, 11 of which will become hurricanes and six of which will reach Category 3 status or stronger,” it noted. “That’s well above the 30-year average tally for both hurricanes and storms and also markedly above the tally of 20 storms, seven hurricanes, and three Cat 3-plus hurricanes in 2023.”
That being said, if you’re in the way of a hurricane, get out of the way and stay safe. As for those looking to invest in hurricane season this summer, here are a few standout stocks to buy today.
Generac Holdings (GNRC)
Generac Holdings (NYSE:GNRC), an $8.6 billion residential generator company, tends to push higher during most hurricane seasons. Last year, for example, GNRC ran from about $108 to a high of nearly $157. This year, it’s just starting to gain momentum, running from about $130 to $143.
As noted by GeneratorSource.com, “The high winds can take down power poles and cause damage to power plants. It can take weeks and, in many cases, months before power company personnel are able to fully restore power. This is why the demand for backup power generators has become so high.”
With the 2024 hurricane season starting, I expect generator demand – and for Generac Holdings’ stock – to accelerate. Helping, at the end of June, analysts at Truist reiterated a buy rating on GNRC with a price target of $170 a share.
It’s one of the top stocks to buy this summer. From here, I’d like to see it initially retest $155.
Xylem (XYL)
Xylem (NYSE:XYL), a $32 billion water stock, also benefits from hurricane season.
After all, according to Investopedia.com, “Clean water shortages can occur after a major storm hits, especially when floodwater affects public drinking water. Companies that can test and treat water, as well as transport it, are needed and are often contracted by the government to help in these cases.”
If you pull up a three-year chart of XYL, you can see the stock rallies around June-July most years with storm seasons. This year, we expect to see similar upside, as it starts to pivot from oversold conditions at $133, where it’s a buy. Even better, while we wait for further upside in the stock, we can collect its current yield of 1.1%.
Plus, earnings haven’t been too shabby. In its first quarter, its earnings per share of 90 cents beat by 6 cents. Revenue of $2 billion was up 40.4% year over year. It also raised its full-year revenue guidance to $8.5 billion, up about 15% to 16% year over year. And it raised its full-year adjusted earnings per share to $4.10 to $4.25 from a prior range of $4 to $4.20.
Home Depot (HD)
Home improvement retailer Home Depot (NYSE:HD) plays a big part in post-hurricane cleanups, too.
And as we’ve seen with Generac and Xylem, Home Depot’s stock also perks up in hurricane season. In 2020, between June and November, HD ran from about $222 to $253. By 2021, it ran from about $291 to $381. Then by 2022, it ran from $282 to $311. In 2023, HD ran from about $273 to just over $309 a share. This year, I’d like to see a similar move, especially with how active the storm season is expected to be.
Better, as we wait for Home Depot to push higher, we can collect its yield of 2.7%. Helping, about 17 analysts rate HD a “buy” with an average price target of $382.59. The high-end of estimates puts HD at $425 a share. Analysts at Evercore ISI, for example, have an outperform rating on the stock with a price target of $420.
On the date of publication, Ian Cooper did not hold (either directly or indirectly) any positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.