How to Profit From Hurricanes (and other natural disasters) 

I’m always amazed at how creative humans can be.

Take for example, the terrible devastation wrought by Hurricane Helene. More than 227 have been reported dead…

Our thoughts and prayers are with those who are affected.

And as I write this, the country is waiting for another category 4 hurricane - Milton - to hit Florida.

What’s crazy… and to be honest a bit unsettling, is the idea of profiting from these disasters. And No, I’m not talking about price gouging.

I’m not talking about the guy who sells a gallon of gas to his neighbor for $50 because all the gas stations are flooded or abandoned.

I’m talking about investors who look to profit from natural disasters.

What’s the morality around profiting from others suffering?

I’ll leave that debate to the far more intelligent philosophers in their ivory tower.

What I see happening is simple. Hurricane Helene caused a ton of damage. Property needs to be rebuilt, homes need repairs, infrastructure needs to be strengthened. Lives need to be put back together…

Despite the loss, this is all economic activity that drives sales, profits, jobs, and growth.

One might argue it’s a natural cycle of rebirth.

So how are investors profiting from disasters like this one?

What you need to do is think past the immediate needs, and look to the long term demands all large scale disasters create.

Here’s a few companies that come easily to mind…

Generac Holdings (GNRC), they make energy products and are well known for their backup generators.

The stock is up 8% today - on news of hurricane Milton.

Copart (CPRT), they specialize in salvaged vehicles, and will no doubt see more business from these extreme weather events.

Home repairs will be huge, and that benefits businesses like Home Depot (HD) and Lowes (LOW).

HD is up 21% and LOW is up 25% in the last 3 months.

Now, I’ll give you one crazy, off the wall, long term idea for profits…

Look at Everest Group (EG). They are a reinsurance Company. They insure the insurance companies.

I know what you’re thinking… “Don’t insurance companies have big exposure for payouts in events like this?”

You’re 100% right.

But here’s the rub… events like this cause insurance companies to raise rates. They’re not dumb. Every time a big event happens, they can simply raise rates and pass those costs back to the consumer.

They charge more, and simply protect their bottom line.

This won’t happen this week or this month, but mark my words, we’re already seeing insurance companies raise rates… and protect their profit margins.

That’s how you profit from natural disasters.

What do you think?

What kind of “Ick” factor do you feel when thinking about investing because of natural disasters?