Submitted by EnergyTechStocks.com
Leading Wall Street water analyst Neil D. Berlant doesn’t like to recommend specific companies that he thinks will do well in the coming era of rapidly-rising water costs. But during a nearly three-hour interview with EnergyTechStocks.com, Berlant, who manages the PFW Water Fund (Symbol: PFWAX), came close, agreeing to name companies he sees as “representative” of the firms that should do well, beginning with:
Ameron International Corp., Northwest Pipe Co. and Mueller Water Products Inc. Ameron and Mueller trade on the New York Stock Exchange, while Northwest Pipe trades on NASDAQ.
Typical of Berlant’s selections, none of these is a household name; however, if water is to continue flowing without interruption to over 100 million U.S. households, not to mention tens of millions of businesses, the products and services of each will increasingly be utilized, Berlant emphasized.
Not surprisingly, Berlant described Portland, OR-based Northwest Pipe as a pipe company with products basically for every kind of water consumer. He also described Pasadena, CA-based Ameron as a pipe company, while characterizing Atlanta-based Mueller as a more integrated water infrastructure products supplier whose line also includes valves, pipe fittings and even fire hydrants.
A quick look at all three firms’ recent results indicates why Berlant thinks investors might want to give each company a closer look in light of the $1 trillion-plus water infrastructure repair program now underway in the U.S. In general, markets for each firm appear to be strong, although raw material costs are a problem.
Last month Northwest Pipe reported a 47% year-over-year increase in second quarter earnings, higher than analysts’ forecasts, along with record sales and order backlog. Earlier this year Ameron raised its quarterly dividend 20% and reported 14% and 24% increases in first quarter earnings and sales, respectively. Despite all that, Ameron stock took a big hit when it failed to meet the expectations of the few analysts who cover the company. The stock price has since recovered.
Earlier this month Mueller reported a fiscal third quarter fully-diluted per share net of 18 cents compared with a loss in the year-ago period. Sales rose about 5% to approximately $528.5 million. Mueller expressed caution over its “near-term economic environment” as a result of the housing market.
Coming Tomorrow, August 20, Part 2 –Two Companies to look at involved with Water Purification for Manufacturing
For other stories in this series, see Leading Wall Street Water Analyst Neil Berlant: Price of Water in US to Rise Up to 300% in Next 2-3 Years