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Water & Investing: Swim among the water stocks

Posted by: Aqua Blog Maven on October 6, 2008 at 7:37 am

From the Washington Post & Kiplinger:

The world is facing a growing shortage of fresh water. In fact, dwindling supplies of this most natural of resources are making water nearly as hard to find as oil. That means companies involved in selling, purifying or facilitating the transport of water should be good investments as the world grapples with reduced flows of the wet stuff.

Shares of water-related companies have bucked the tide during the market downturn. Over the past year to September 8, PowerShares Water Resources, an exchange-traded fund, broke even, while Standard & PoorÕs 500-stock index sank 14%. Some water stocks have performed remarkably well. Shares of Northwest Pipe — which, not surprisingly, makes pipes for water infrastructure and other purposes — have jumped 49% over the past year. Shares of American Water Works, a utility, have risen 3% since the company went public in April, outshining the S&P 500 by 13 percentage points.
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If you want to swim in the world of water, you have a choice of pools. You could buy shares of companies that make equipment for utilities, purification programs and other water-related projects. Also worth a look are companies that will replace the nation’s aging pipes and provide new ones for transporting water to growing population centers. In addition, water utilities offer generous dividends and provide steady growth that could accelerate as demand increases and state regulators approve rate hikes. Meanwhile, companies in the U.S. and in places with burgeoning populations and desert environments are investing in desalination plants, which purify seawater by extracting salt and other minerals.

Find out more including specific companies you might invest in from the Washington Post & Kiplinger by clicking here.

October 6, 2008 · Filed Under Water & Investing

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