friedt

4 Comments

    • ON: Sat May 24th 20:00 PM
      Commented on:
      Diving Into the Water ETF
      I forgot to mention Canadian water companies that have also been bought out (by GE), but a number remain. I own LGV which used to be GLAGF. Also, look in medical instruments field for companies that manufacture devices that measure water purity. I know it sounds like a wide net, but water is a wide net and touches strongly on food companies as well as agri companies.
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    • ON: Sat May 24th 19:48 PM
      Commented on:
      Diving Into the Water ETF
      Many of the stocks analyzed have had their run-ups. Fortunately for me, I was on water years ago and bought CWCO (desalinization), SBS (Brazilian water utility), CBI (water transport and containers), Valmont (agricultural equipment) and both Itron and Badger Meter after seeing a tiny article in WSJ about landlords thinking of installing water meters alongside gas and electricity measurement. For pipelines see Ameron. But in the last 4 years, literally dozens of water related companies have been bought out at premiums by GE (Ionics and a few others) and Teledyne (it purchased a water meter company). American Water Works has been an incredible investment. I bought it under 20; it was bought out by the German behemoth RWE at $44. When that purchase was announced, arbitragers made a fortune because the gap remained at 39 and 40 while the deal cleared AND continued to pay dividends during the wait. I bought RWE after its AWK purchase and rode it to $117. Now AWK is back as an IPO, with some early financial issues, but essentially the same company that fetched $44 a few years ago. Similarly, Nalco was bought out at a premium and subsequently returned as an IPO.

      While the criticism of individual companies in PHO is quite valid, in many cases it is because the ETF (and much of the public) is jumping on water very late. Mario Gabelli had been preaching water for years!

      As for other water related companies: check many of the basic chemical companies for water purifying chemicals. Check some of the agri equipment companies. Pipe companies (plastic and metal)have been bought out but others remain. There are companies that own water rights. Check out CADIZ and PICO. And as one of the other comments suggested, check on global water companies, from Austria's BTW to Japan's Kurita, France's Suez, and companies in Italy, Finland, and elsewhere. But still here in USA: Mueller Water, Chart Industries (though it has had a run-up) and various fluid flow control/measurement companies.

      Unfortunately, by the time CNBC and others get around to a topic, it's too late to make the initial big money. I know casually one of the hosts on CNBC and have bugged him for years about not reporting on water. He blew me off each time, finally telling me that when water really becomes scarce, the govt. will take it over and no one will make money off water! Sure, just like with oil and gas!

      So do research. There are a number of private companies that are good with water. Keep an eye out for IPOs. But if Immelt would make GE Water a stand alone company, it would be better than VE because it has gobbled up every water related company it could over the last few years. Basin Water has been a notable failure in water, due to financial shennigans and I have not made any money off Euro Tech Environmental, but there are still possibilities out there even if the early money (as with CCC and others in PHO) has been made. Tom
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    • ON: Wed Apr 23rd 14:41 PM
      Commented on:
      Hot IPOs: Intrepid Potash and American Water Works
      When AWK was taken out by RWE a few years back, it was at $44. It took a while for the regulators to accept the deal, and AWK languished at a remarkably low $39 for almost a year, while paying dividends. The arbitrage was incredible! It is now back on market at 20-22, with the need for water and wastewater greater than before. I would suggest that water stocks (not necessarily utilities) will command higher multiples than before, esp. if they develop their water purification and wastewater components. Kelda was taken out in England at a premium. CCC has doubled thanks to China's need for its carbon filters. Aqua and AWK will go higher as people demand water from companies that can provide it better and cleaner than others. These two are ending the monopoly of municipal (and hence regulated) water utilities, opening the possibility of higher prices for the stocks and the related industries. See the Colfax IPO upcoming.
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    • ON: Sat Mar 15th 17:35 PM
      Commented on:
      Will the Agriculture Boom Last?
      Fidelity used to have a Food and Agri Fund (now renamed Consumer Staples) that I bought early and complained about bitterly to the manager for having too much money in tobacco stocks but very little in agricultural chemicals. Because the Fund didn't change, I started buying POT and other crop fertilizers on my own, along with irrigation equipment and pipes. I still don't know why the fund stayed with tobacco as long as it did and ignored not only fertiolizers but also genetic based agris like Monsanto, Dow, and Dupont.

      On another matter, please note Brazil's Cosan (CZZ) as an agriculturural company benefitting from both demand and ethanol. Even the Argentinian agri co CRESY is doing well as is Florida's Alico. Why is TV and blog coverage limited to the best known stocks?
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